[5] The site where Terry is located was first called Joubert's Landing, in recognition of the man who built a supply point along the Yellowstone River for freighters traveling from Bismarck, Dakota Territory, to Miles City, Montana Territory.

When the Northern Pacific Railway's transcontinental rail line arrived in 1881, the town was renamed for Alfred Howe Terry,[6] a general in the Union Army who commanded an 1876 expedition in connection with George Armstrong Custer’s campaign against Native Americans,[7] specifically in the west.

The Custer Creek train wreck, the worst rail disaster in Montana history, occurred near Terry along this line in 1938.

[8] Terry is in Eastern Montana, approximately 1 km (0.62 mi) south of the Yellowstone River.

According to the United States Census Bureau, the town has a total area of 0.71 square miles (1.84 km2), all land.

[9] The Terry Badlands lie just north of the Yellowstone River, and is one of the wilderness study areas in Montana.

[17] The Terry Badlands WSA and the Evelyn Cameron Museum attract visitors from all over the world every year.

The guest registry in the Evelyn Cameron museum has entries from as far away as Europe, Asia, and Africa.

Efforts to increase ecotourism include an Americorps VISTA project to create a trail network for hikers and campers in the surrounding badlands.

The Terry Badlands Trails Project encourages the Leave No Trace principles.

[18] The hotel has hosted the likes of U.S. President Theodore Rosevelt and frontierswoman Calamity Jane.

[18] The Township of Terry has a Mayor-Council government with Rolane Christofferson serving as mayor.