diff --git a/.github/workflows/ci.yml b/.github/workflows/ci.yml
index dc01acc..897d8de 100644
--- a/.github/workflows/ci.yml
+++ b/.github/workflows/ci.yml
@@ -28,8 +28,6 @@ jobs:
         - "3.0"
         - "2.7"
         - "2.6"
-        - "2.5"
-        - "jruby"
         include:
           - ruby: "3.0"
             coverage: "true"
diff --git a/docsite/source/index.html.md b/docsite/source/index.html.md
index 028f8cc..e9b41ee 100644
--- a/docsite/source/index.html.md
+++ b/docsite/source/index.html.md
@@ -49,7 +49,10 @@ Currently, the railtie **does not make any assumptions about your directory/file
 ```ruby
 # config/initializers/system.rb
 Dry::Rails.container do
-  auto_register!("app/operations")
+  config.component_dirs.add "app/operations"
+  config.component_dirs.add "lib" do |dir|
+    dir.default_namespace = "my_super_cool_app"
+  end
 end
 ```
 
diff --git a/dry-rails.gemspec b/dry-rails.gemspec
index 6f3d5bc..032840a 100644
--- a/dry-rails.gemspec
+++ b/dry-rails.gemspec
@@ -29,9 +29,9 @@ Gem::Specification.new do |spec|
   spec.required_ruby_version = ">= 2.6.0"
 
   # to update dependencies edit project.yml
-  spec.add_runtime_dependency "dry-schema", "~> 1.5"
-  spec.add_runtime_dependency "dry-system", "~> 0.18.0", ">= 0.18.1"
-  spec.add_runtime_dependency "dry-validation", "~> 1.5"
+  spec.add_runtime_dependency "dry-schema", "~> 1.8"
+  spec.add_runtime_dependency "dry-system", "~> 0.20.0", ">= 0.18.1"
+  spec.add_runtime_dependency "dry-validation", "~> 1.7"
 
   spec.add_development_dependency "bundler"
   spec.add_development_dependency "rake"
diff --git a/lib/dry/rails.rb b/lib/dry/rails.rb
index c7551e0..839a3bf 100644
--- a/lib/dry/rails.rb
+++ b/lib/dry/rails.rb
@@ -11,10 +11,12 @@ module Dry
   #   # config/initializer/system.rb
   #
   #   Dry::Rails.container do
-  #     auto_register!("lib", "app/operations")
-  #   end
+  #     config.component_dirs.add "lib" do |dir|
+  #       dir.default_namespace = "my_super_cool_app"
+  #     end
   #
-  # @see Dry::Rails::Container.auto_register!
+  #     config.component_dirs.add "app/operations"
+  #   end
   #
   # @api public
   module Rails
diff --git a/lib/dry/rails/container.rb b/lib/dry/rails/container.rb
index ae4b6be..dcad37d 100644
--- a/lib/dry/rails/container.rb
+++ b/lib/dry/rails/container.rb
@@ -27,19 +27,9 @@ class Container < System::Container
       #
       #   @api public
       # @!scope class
-      setting :features, %i[application_contract safe_params controller_helpers], reader: true
-
-      # @overload config.auto_register_paths=(paths)
-      #   Set an array of path/block pairs for auto-registration
-      #
-      #   This is a low-level setting that typically should not be set explicitly,
-      #   use `auto_register!` instead.
-      #
-      #   @param paths [Array<Array>]
-      #
-      #   @api public
-      # @!scope class
-      setting :auto_register_paths, [].freeze, reader: true
+      setting :features,
+              default: %i[application_contract safe_params controller_helpers],
+              reader: true
 
       # @overload config.auto_inject_constant=(auto_inject_constant)
       #   Set a custom import constant name
@@ -48,7 +38,9 @@ class Container < System::Container
       #
       #   @api public
       # @!scope class
-      setting :auto_inject_constant, "Deps", reader: true
+      setting :auto_inject_constant,
+              default: "Deps",
+              reader: true
 
       # @overload config.container_constant=(container_constant)
       #   Set a custom container constant
@@ -57,7 +49,9 @@ class Container < System::Container
       #
       #   @api public
       # @!scope class
-      setting :container_constant, "Container", reader: true
+      setting :container_constant,
+              default: "Container",
+              reader: true
 
       # @!endgroup
 
@@ -65,82 +59,6 @@ class Container < System::Container
       config.auto_registrar = Rails::AutoRegistrars::App
 
       class << self
-        # Set up auto-registration paths and optional a configuration block
-        #
-        # @example set up a single path
-        #   Dry::Rails.container do
-        #     auto_register!("app/operations")
-        #   end
-        #
-        # @example set up a single path with a configuration block
-        #   Dry::Rails.container do
-        #     auto_register!("app/operations") do |config|
-        #       config.exclude do |component|
-        #         component.path.start_with?("concerns")
-        #       end
-        #     end
-        #   end
-        #
-        # @example set up multiple paths
-        #   Dry::Rails.container do
-        #     auto_register!("lib", "app/operations")
-        #   end
-        #
-        # @example set up multiple paths with a configuration block
-        #   Dry::Rails.container do
-        #     # in this case the config block will be applied to all paths
-        #     auto_register!("lib", "app/operations") do |config|
-        #       config.exclude do |component|
-        #         component.path.start_with?("concerns")
-        #       end
-        #     end
-        #   end
-        #
-        # @param paths [Array<String>] One or more paths relative to the root
-        # @param set_load_paths [Boolean] Whether the paths should be added to $LOAD_PATH
-        # @param load_files [Boolean] Whether files should be `required`-ed already
-        #
-        # @return [self]
-        #
-        # @api public
-        #
-        # TODO: this should be moved to dry-system
-        def auto_register!(*paths, set_load_paths: true, load_files: false, &block)
-          load_paths!(*paths) if set_load_paths
-
-          if load_files
-            paths.each { |path| super(path, &block) }
-          else
-            config.auto_register_paths.concat(paths.product([block]))
-          end
-
-          self
-        end
-
-        # Finalize the container
-        #
-        # This is called automatically via the railtie, so typically you won't be using this method
-        # directly
-        #
-        # @param freeze [Boolean] Whether the container should be frozen upon finalization
-        #
-        # @return [self]
-        #
-        # @api public
-        #
-        # TODO: just like auto_register!, this should be moved to dry-system
-        def finalize!(freeze: false, &block)
-          features.each do |feature|
-            start(feature)
-          end
-
-          auto_register_paths.each do |(path, path_block)|
-            auto_register!(path, set_load_paths: false, load_files: true, &path_block)
-          end
-
-          super
-        end
-
         # Return if a given component was booted
         #
         # @return [Boolean]
diff --git a/lib/dry/rails/railtie.rb b/lib/dry/rails/railtie.rb
index 10a2a14..4063b93 100644
--- a/lib/dry/rails/railtie.rb
+++ b/lib/dry/rails/railtie.rb
@@ -33,8 +33,6 @@ def finalize!
 
         container = Dry::Rails.create_container(
           root: root_path,
-          name: name,
-          default_namespace: name.to_s,
           inflector: default_inflector,
           system_dir: root_path.join("config/system"),
           bootable_dirs: [root_path.join("config/system/boot")]
diff --git a/spec/dummy-6.x/dummy/config/environments/test.rb b/spec/dummy-6.x/dummy/config/environments/test.rb
index bae3b39..c045a26 100644
--- a/spec/dummy-6.x/dummy/config/environments/test.rb
+++ b/spec/dummy-6.x/dummy/config/environments/test.rb
@@ -18,7 +18,7 @@
   # Configure public file server for tests with Cache-Control for performance.
   config.public_file_server.enabled = true
   config.public_file_server.headers = {
-    "Cache-Control" => "public, max-age=#{1.hour.to_i}"
+    "Cache-Control" => "public, max-age=3600"
   }
 
   # Show full error reports and disable caching.
diff --git a/spec/dummy/app/forms/create_user_form.rb b/spec/dummy/app/forms/create_user_form.rb
new file mode 100644
index 0000000..0b928fc
--- /dev/null
+++ b/spec/dummy/app/forms/create_user_form.rb
@@ -0,0 +1,4 @@
+# frozen_string_literal: true
+
+class CreateUserForm
+end
diff --git a/spec/dummy/config/initializers/system.rb b/spec/dummy/config/initializers/system.rb
index 82ce138..2e7ceba 100644
--- a/spec/dummy/config/initializers/system.rb
+++ b/spec/dummy/config/initializers/system.rb
@@ -3,5 +3,13 @@
 require "dry/rails"
 
 Dry::Rails.container do
-  auto_register!("lib")
+  config.component_dirs.add "lib" do |dir|
+    dir.default_namespace = "dummy"
+  end
+
+  config.component_dirs.add "app/operations"
+  config.component_dirs.add "app/services"
+  config.component_dirs.add("app/workers") do |dir|
+    dir.memoize = true
+  end
 end
diff --git a/spec/integration/dry/rails/container/auto_register/with_block_spec.rb b/spec/integration/dry/rails/container/auto_register/with_block_spec.rb
deleted file mode 100644
index 8fb0696..0000000
--- a/spec/integration/dry/rails/container/auto_register/with_block_spec.rb
+++ /dev/null
@@ -1,21 +0,0 @@
-# frozen_string_literal: true
-
-RSpec.describe Dry::Rails::Container, ".auto_register!" do
-  subject(:system) { Dummy::Container }
-
-  before(:all) do
-    Dry::Rails.container do
-      auto_register!("app/workers") do |config|
-        config.memoize = true
-      end
-    end
-  end
-
-  it "auto-registers files based on block config" do
-    mailer_worker = Dummy::Container["mailer_worker"]
-
-    expect(mailer_worker).to be_instance_of(MailerWorker)
-    expect(Dummy::Container["mailer_worker"]).to be(mailer_worker) # memoized
-    expect(mailer_worker.mailer).to be_instance_of(Mailer)
-  end
-end
diff --git a/spec/integration/dry/rails/container/auto_register/without_block_spec.rb b/spec/integration/dry/rails/container/auto_register/without_block_spec.rb
deleted file mode 100644
index d2036a9..0000000
--- a/spec/integration/dry/rails/container/auto_register/without_block_spec.rb
+++ /dev/null
@@ -1,35 +0,0 @@
-# frozen_string_literal: true
-
-RSpec.describe Dry::Rails::Container, ".auto_register!" do
-  subject(:system) { Dummy::Container }
-
-  context "with a single path" do
-    before(:all) do
-      Dry::Rails.container do
-        auto_register!("app/operations")
-      end
-    end
-
-    it "auto-registers files found under the specified path" do
-      create_user = Dummy::Container["create_user"]
-
-      expect(create_user).to be_instance_of(CreateUser)
-    end
-  end
-
-  context "with multiple paths" do
-    before(:all) do
-      Dry::Rails.container do
-        auto_register!("app/operations", "app/services")
-      end
-    end
-
-    it "auto-registers files found under the specified paths" do
-      create_user = Dummy::Container["create_user"]
-      github = Dummy::Container["github"]
-
-      expect(create_user).to be_instance_of(CreateUser)
-      expect(github).to be_instance_of(Github)
-    end
-  end
-end
diff --git a/spec/integration/dry/rails/container/resolve_spec.rb b/spec/integration/dry/rails/container/resolve_spec.rb
index f5e7fc8..cad03fa 100644
--- a/spec/integration/dry/rails/container/resolve_spec.rb
+++ b/spec/integration/dry/rails/container/resolve_spec.rb
@@ -3,24 +3,25 @@
 RSpec.describe Dry::Rails::Container, ".[]" do
   subject(:system) { Dummy::Container }
 
-  context "with auto-registration" do
-    before(:all) do
-      Dry::Rails.container do
-        auto_register!("app/operations")
-      end
-    end
-
+  context "with auto-registration from system initializer" do
     it "returns an auto-registered component" do
       expect(system["create_user"]).to be_instance_of(CreateUser)
+      expect(system["github"]).to be_instance_of(Github)
     end
-  end
 
-  context "with auto-registration from system initializer" do
     it "returns auto-registered component with another auto-injected" do
       notifier = system[:notifier]
 
       expect(notifier).to be_instance_of(Dummy::Notifier)
       expect(notifier.mailer).to be_instance_of(Mailer)
     end
+
+    it "auto-registers files based on block config" do
+      mailer_worker = Dummy::Container["mailer_worker"]
+
+      expect(mailer_worker).to be_instance_of(MailerWorker)
+      expect(Dummy::Container["mailer_worker"]).to be(mailer_worker) # memoized
+      expect(mailer_worker.mailer).to be_instance_of(Mailer)
+    end
   end
 end
diff --git a/spec/integration/dry/rails/container_spec.rb b/spec/integration/dry/rails/container_spec.rb
index d5d77a4..2cbd03b 100644
--- a/spec/integration/dry/rails/container_spec.rb
+++ b/spec/integration/dry/rails/container_spec.rb
@@ -30,7 +30,6 @@
   end
 
   it "allows setting up the container in multiple steps" do
-    expect(system.config.default_namespace).to eql("dummy")
     expect(system[:logger]).to be_instance_of(Logger)
   end
 
diff --git a/spec/integration/dry/rails/railtie/finalize_spec.rb b/spec/integration/dry/rails/railtie/finalize_spec.rb
index 7808549..8608e80 100644
--- a/spec/integration/dry/rails/railtie/finalize_spec.rb
+++ b/spec/integration/dry/rails/railtie/finalize_spec.rb
@@ -7,21 +7,23 @@
     Rails.application.reloader.reload!
 
     Dry::Rails.container do
-      auto_register!("app/operations")
+      config.component_dirs.add "app/forms"
     end
 
     Dummy::Container.register("foo", Object.new)
 
+    expect(Dummy::Container.keys).to include("foo")
+
     Rails.application.reloader.reload!
 
     expect(Dummy::Container.keys).to_not include("foo")
 
     klass = Class.new do
-      include Dummy::Deps["create_user"]
+      include Dummy::Deps["create_user_form"]
     end
 
     obj = klass.new
 
-    expect(obj.create_user).to be_instance_of(CreateUser)
+    expect(obj.create_user_form).to be_instance_of(CreateUserForm)
   end
 end
diff --git a/templates/default.rb b/templates/default.rb
index 7b670fc..0f60865 100644
--- a/templates/default.rb
+++ b/templates/default.rb
@@ -8,6 +8,8 @@
     config.features = %i[application_contract]
 
     # enable auto-registration in the lib dir
-    # auto_register!('lib')
+    # config.component_dirs.add "lib" do |dir|
+    #   dir.default_namespace = "my_super_cool_app"
+    # end
   end
 CODE