A post office was established November 30, 1894, and town was named Terlton for a member of the first territorial legislature, Ira N. Terrell.

Oil was discovered in the vicinity about 1914, and oil-related industries like pipelines, tank farms and refining supported the town into the 1930s.

[4] On Thursday April 26, 1984, a large nighttime F4 tornado struck the small town, killing three people and injuring over 30.

This happened the same night as a tornado killed eight and injured nearly 100 in Morris, Oklahoma in Okmulgee County, 60 miles (97 km) to the southeast.

[6] Terlton was one of the filming sites for principal photography on Season One of the FX comedy series Reservation Dogs from filmmaker Sterlin Harjo, which concerns four Native American teens in rural Oklahoma.

[7] According to the United States Census Bureau, the town has a total area of 0.2 square miles (0.52 km2), all land.