It is unclear what your problem is. The item type name in the right hand pane of the zotero window is only there to tell the use which item type they choose. It is not displayed once you create a bibliography.
There is a field within the item type "Thesis" which in English is called "Type", where you manually add the item type. Your bibliographic style may use/uses the information in this field. Now this is indeed a problem if you use styles in different languages, as I think the styles do not translate the content of the field. But it is you, the user, who decides in which language you enter data for that field. If you mostly publish in German, then write "Abschlussarbeit" or whatever you think makes sense into that field.
If you then publish an English article, you will either need to search/replace for that field in the final bibliography, or change by hand the data in the relevant field.
It may be that some citation styles include a prefix such as "Dissertation" whenever an item type "thesis" occurs. In this case you would need to either change the citation style, choose a different citation style or again, change the final bibliography by hand

Thank you for your reply!

My problem does not regard creating a bibliography. I am only talking about the naming within zotero. I take issue with classifying a master's thesis as a "Dissertation" within zotero because it is not one. If the language preference of the zotero program is set to "English", one does not have this problem because "thesis" can be used for a bachelor's, master's or doctoral thesis alike. The German word "Dissertation" cannot and it would therefore be confusing to classify a master's thesis as such if the language preference is set to "German".

As I said, I would suggest changing the German translation of the type "thesis" to "Abschlussarbeit".

I am a German native speaker and agree with adamsmith. Also, I think it is rather obvious that if someone works with the German language version and needs to find a relevant item type for an MA thesis, that they would choose "dissertation" as type. They would also quickly see that "dissertation" contains all relevant fields.

I would say "Abschlussarbeit" is much less awkward for a doctoral thesis than "Dissertation" is for a master's thesis but I suppose I am outnumbered. :) Maybe someone else comes up with a more precise translation.

I do not see a problem with the last two. I would personally favor "Akademische Arbeit" for clarity over the brevity of "Abhandlung".

But wouldn't both "Akademische Arbeit" and "Hochschulschrift" include regular manuscripts, including those written by faculty?

Edit: Ditto for "Abhandlung"

Zulassungsarbeit and Examensarbeit are less understandable in Austria and Abhandlung is definitely too broad.

As a native speaker with Swiss background (and experience in germany and Austria), in Switzerland noone ever uses the term Hochschulschrift and it would be probably more confusing, though i can see the point that from a technical point of view it is most correct. I still prefer dissertation, also because i guess 95% of all references in academic works to some kind of thesis are to PhDs, abd only a tiny minority to MA and BA theses.

Right, but the problem is that data entry isn't done by catalogers with access to (or any interest in) controlled vocabularies, so the fact that a large part of German-language users wouldn't know what a "Hochschulschrift" is or even to look for that category does pose a concern. It's definitely the technically correct translation; I'm still unsure if it's the pragmatically correct one.