diff --git a/Gemfile.lock b/Gemfile.lock
index 82a702316..0754ea03e 100644
--- a/Gemfile.lock
+++ b/Gemfile.lock
@@ -1,7 +1,7 @@
 PATH
   remote: .
   specs:
-    view_component (3.4.0)
+    view_component (3.5.0)
       activesupport (>= 5.2.0, < 8.0)
       concurrent-ruby (~> 1.0)
       method_source (~> 1.0)
diff --git a/docs/CHANGELOG.md b/docs/CHANGELOG.md
index 599b1f823..493e13fa0 100644
--- a/docs/CHANGELOG.md
+++ b/docs/CHANGELOG.md
@@ -10,6 +10,8 @@ nav_order: 5
 
 ## main
 
+## 3.5.0
+
 * Add Skroutz to users list.
 
     *Chris Nitsas*
diff --git a/docs/_data/library.yml b/docs/_data/library.yml
index ef3f3ccdb..a99e3342c 100644
--- a/docs/_data/library.yml
+++ b/docs/_data/library.yml
@@ -1 +1 @@
-version: 3.4.0
+version: 3.5.0
diff --git a/docs/guide/templates.md b/docs/guide/templates.md
index 312d192cf..1f11bdb3d 100644
--- a/docs/guide/templates.md
+++ b/docs/guide/templates.md
@@ -143,26 +143,13 @@ class MyComponent < ViewComponent::Base
 end
 ```
 
-Finally, `#render_parent` also works inside `#call` methods:
+Keep in mind that `#render_parent` doesn't return a string. If a string is desired, eg. inside a `#call` method, call `#render_parent_to_string` instead. For example:
 
 ```ruby
 class MyComponent < ViewComponent::Base
   def call
     content_tag("div") do
-      render_parent
-    end
-  end
-end
-```
-
-When composing `#call` methods, keep in mind that `#render_parent` does not return a string. If a string is desired, call `#render_parent_to_string` instead. For example:
-
-```ruby
-class MyComponent < ViewComponent::Base
-  # "phone" variant
-  def call_phone
-    content_tag("div") do
-      "<div>#{render_parent_to_string}</div>"
+      render_parent_to_string
     end
   end
 end
diff --git a/lib/view_component/base.rb b/lib/view_component/base.rb
index ac3256a3c..9efc78738 100644
--- a/lib/view_component/base.rb
+++ b/lib/view_component/base.rb
@@ -127,17 +127,8 @@ def render_in(view_context, &block)
     # parent template considering the current variant and emits the result without
     # double-rendering.
     def render_parent
-      @__vc_parent_render_level ||= 0 # ensure a good starting value
-
-      begin
-        target_render = self.class.instance_variable_get(:@__vc_ancestor_calls)[@__vc_parent_render_level]
-        @__vc_parent_render_level += 1
-
-        target_render.bind_call(self, @__vc_variant)
-        nil
-      ensure
-        @__vc_parent_render_level -= 1
-      end
+      render_parent_to_string
+      nil
     end
 
     # Renders the parent component to a string and returns it. This method is meant
@@ -151,7 +142,16 @@ def render_parent
     #
     # When rendering the parent inside an .erb template, use `#render_parent` instead.
     def render_parent_to_string
-      capture { render_parent }
+      @__vc_parent_render_level ||= 0 # ensure a good starting value
+
+      begin
+        target_render = self.class.instance_variable_get(:@__vc_ancestor_calls)[@__vc_parent_render_level]
+        @__vc_parent_render_level += 1
+
+        target_render.bind_call(self, @__vc_variant)
+      ensure
+        @__vc_parent_render_level -= 1
+      end
     end
 
     # Optional content to be returned after the rendered template.
diff --git a/lib/view_component/version.rb b/lib/view_component/version.rb
index 8cbaadcc4..cc0c9e583 100644
--- a/lib/view_component/version.rb
+++ b/lib/view_component/version.rb
@@ -3,7 +3,7 @@
 module ViewComponent
   module VERSION
     MAJOR = 3
-    MINOR = 4
+    MINOR = 5
     PATCH = 0
     PRE = nil
 
diff --git a/test/sandbox/app/components/inline_level1_component.rb b/test/sandbox/app/components/inline_level1_component.rb
index bbc996d85..a55e51eaf 100644
--- a/test/sandbox/app/components/inline_level1_component.rb
+++ b/test/sandbox/app/components/inline_level1_component.rb
@@ -2,6 +2,8 @@
 
 class InlineLevel1Component < ViewComponent::Base
   def call
-    content_tag(:div, class: "level1-component")
+    content_tag(:div, class: "level1-component") do
+      "Level 1 component"
+    end
   end
 end
diff --git a/test/sandbox/app/components/inline_level2_component.rb b/test/sandbox/app/components/inline_level2_component.rb
index bb6378589..3a67b20e8 100644
--- a/test/sandbox/app/components/inline_level2_component.rb
+++ b/test/sandbox/app/components/inline_level2_component.rb
@@ -1,11 +1,11 @@
 # frozen_string_literal: true
 
-class InlineLevel2Component < Level2Component
+class InlineLevel2Component < InlineLevel1Component
   def call
-    "<div level2-component base>#{render_parent_to_string}</div>"
+    "<div class='level2-component base'>#{render_parent_to_string}</div>".html_safe
   end
 
   def call_variant
-    "<div level2-component variant>#{render_parent_to_string}</div>"
+    "<div class='level2-component variant'>#{render_parent_to_string}</div>".html_safe
   end
 end
diff --git a/test/sandbox/app/components/inline_level3_component.rb b/test/sandbox/app/components/inline_level3_component.rb
index 99e0c4aff..1e31bbaa3 100644
--- a/test/sandbox/app/components/inline_level3_component.rb
+++ b/test/sandbox/app/components/inline_level3_component.rb
@@ -1,15 +1,15 @@
 # frozen_string_literal: true
 
-class InlineLevel3Component < Level2Component
+class InlineLevel3Component < InlineLevel2Component
   def call
     content_tag(:div, class: "level3-component base") do
-      render_parent
+      render_parent_to_string
     end
   end
 
   def call_variant
     content_tag(:div, class: "level3-component variant") do
-      render_parent
+      render_parent_to_string
     end
   end
 end