
Star Wars has been ignoring the fan-designated "Baby Yoda" name for Grogu, especially since the character's actual name was revealed in The Mandalorian Season 2. However, the franchise has put a stop to not using the Baby Yoda term, as a trailer for an upcoming Star Wars project featured a character using that exact term.
An official trailer was recently released for LEGO Star Wars: Rebuild the Galaxy: Pieces of the Past, which is the second season of the LEGO Star Wars: Rebuild the Galaxy series that is on Disney+. At one point in the trailer, a character actually uses the term "Baby Yoda" to describe Grogu, which is the first time that the character has been used in an official Star Wars project.
Specifically, at the 1:11 mark in the trailer, Marsai Martin's Yesi Scala is standing in front of Grogu in his levitating pod that mimics a baby stroller. Then, while pointing at him, she says, "We found a Baby Yoda!" This is a historic moment in the Star Wars franchise, as it is the first time a character has actually used the Baby Yoda name on-screen.

Notably, this is also an instance of Star Wars canonizing a name that was initially invented by fans. Before Grogu received his name in Season 2, Star Wars fans didn't know what to call him. Since he looked like a baby version of Yoda, everyone simply named him Baby Yoda. The name was so popular that, even after Grogu was revealed to be his name, many still used "Baby Yoda" when talking about Grogu.
It is worth noting that this is not the first time Star Wars has taken a name or a concept that was made popular by fans and then inserted it into Star Wars lore. In fact, there is an official term for that — fanon. Some of the most popular Star Wars characters have been connected to fanon, including the most famous clone and stormtrooper legion in the galaxy.
The full trailer for LEGO Star Wars: Rebuild the Galaxy: Pieces of the Past can be seen below:
Notable Examples of Star Wars Fanon
The 501st Legion

When Star Wars fans hear the term "501st," everyone automatically thinks of the clone troopers from the prequel trilogy and The Clone Wars who sport dark blue paint on their armor. In Star Wars canon, the 501st Legion was Anakin Skywalker's specific clone trooper legion led by Captain Rex.
However, many will be surprised to learn that, before the 501st Legion was canon, it was actually a name invented by the fans. Specifically, the original term was made up by a group of fans. Since then, the group has developed a worldwide presence and has even provided some costuming for Lucasfilm in The Mandalorian.
Timothy Zahn (who was the author of the acclaimed Heir to the Empire book trilogy) named the 501st Legion after the fan group that was already operating under the same name. Zahn was simply paying homage to the group and giving it a nod in his novel titled Survivor's Quest, but Star Wars took the name and ran with it.
In Revenge of the Sith, Star Wars officially brought the 501st Legion into canon. It was then explored further in the 2005 Battlefront II video game, before being referenced and focused on in other Star Wars projects like The Clone Wars.
Cos Palpatine

Before Emperor Palpatine's first name was revealed to be Sheev in a 2014 novel, many fans believed that it was Cos. This was because of something George Lucas himself did all the way back in 1974, before A New Hope was ever released. In an early script for that film, Lucas designated that the Galactic Emperor was named Cos Dashit.
That was obviously changed, as the name Emperor Palpatine ended up being the name used in canon. However, in the Darth Plagueis novel, it was confirmed that Sheev Palpatine's father was named Cosinga Palpatine. So, Sheev's father was named Cos Palpatine, which was the name fans came up with for Sheev for many years, marking another instance where a fan-designated name was brought into official storytelling.
The GFFA

The Star Wars galaxy was never given an official name. However, Star Wars fans took it upon themselves to name it, and many simply began calling it the GFFR. The reasoning behind that was that it was the acronym for "galaxy far, far away," which pops up in text before the opening crawl of Star Wars movies.
When Del Rey was publishing stories set within the Star Wars universe, it eventually gave the Star Wars galaxy an official name — the Galactic Federation of Free Alliances. When that name is condensed down into an acronym, fans will notice that it reads "GFFR," the same name that Star Wars fans used for the galaxy many years before.
R2-KT

A droid was created by the R2-D2 Builders Club in 2005 to celebrate and pay respect to Katie Johnson. Katie was the seven-year-old child of Albin Johnson, the founder of the 501st Legion. Katie was tragically diagnosed with terminal cancer, and said that she wished she had her own droid. The Builders Club constructed R2-KT (with the KT part of the name designed to sound like the name Katie) for her, and it stayed by her side in her final days.
In Star Wars: The Clone Wars, R2-KT was made canon by Dave Filoni. Filoni included the droid in the Clone Wars film and in multiple episodes of the series as a way to honor Katie Johnson and her memory. Notably, she also appeared in The Force Awakens and multiple Star Wars LEGO projects, allowing Katie to be immortalized in the galaxy far, far away.