diff --git a/local-cli/.npmignore b/local-cli/.npmignore
index e40506d719b298..f6521c7e3f2e85 100644
--- a/local-cli/.npmignore
+++ b/local-cli/.npmignore
@@ -1,2 +1,3 @@
 __fixtures__
 __tests__
+!/templates/HelloWorld/__tests__
diff --git a/local-cli/generator/copyProjectTemplateAndReplace.js b/local-cli/generator/copyProjectTemplateAndReplace.js
index 8f04b439faeb30..552b1c80175cd0 100644
--- a/local-cli/generator/copyProjectTemplateAndReplace.js
+++ b/local-cli/generator/copyProjectTemplateAndReplace.js
@@ -127,6 +127,7 @@ function translateFilePath(path) {
     .replace('_BUCK', 'BUCK')
     .replace('_gitignore', '.gitignore')
     .replace('_gitattributes', '.gitattributes')
+    .replace('_babel.config.js', 'babel.config.js')
     .replace('_babelrc', '.babelrc')
     .replace('_flowconfig', '.flowconfig')
     .replace('_buckconfig', '.buckconfig')
diff --git a/local-cli/init/init.js b/local-cli/init/init.js
index cbb189533438bb..dec823b52be365 100644
--- a/local-cli/init/init.js
+++ b/local-cli/init/init.js
@@ -90,7 +90,7 @@ function generateProject(destinationRoot, newProjectName, options) {
     });
   }
   if (!options['skip-jest']) {
-    const jestDeps = `jest babel-jest metro-react-native-babel-preset react-test-renderer@${reactVersion}`;
+    const jestDeps = `jest babel-core@^7.0.0-bridge.0 babel-jest metro-react-native-babel-preset react-test-renderer@${reactVersion}`;
     if (yarnVersion) {
       console.log('Adding Jest...');
       execSync(`yarn add ${jestDeps} --dev --exact`, {stdio: 'inherit'});
diff --git a/local-cli/templates/HelloWorld/_babel.config.js b/local-cli/templates/HelloWorld/_babel.config.js
new file mode 100644
index 00000000000000..b66a04a3617e7c
--- /dev/null
+++ b/local-cli/templates/HelloWorld/_babel.config.js
@@ -0,0 +1,3 @@
+module.exports = {
+  presets: ["module:metro-react-native-babel-preset"]
+}
diff --git a/local-cli/templates/HelloWorld/_babelrc b/local-cli/templates/HelloWorld/_babelrc
deleted file mode 100644
index d4b74b5be7b43d..00000000000000
--- a/local-cli/templates/HelloWorld/_babelrc
+++ /dev/null
@@ -1,3 +0,0 @@
-{
-  "presets": ["module:metro-react-native-babel-preset"]
-}