<p>Terpenoids are among the most diverse and abundant classes of plant secondary metabolites, with over 134,000 structures identified to date across green plants. In addition to plants, numerous microorganisms and animals, including arthropods, can synthesise terpenoids. All terpenoids are derived from the 5-carbon isoprene units. These compounds play crucial roles in mediating interactions between plants and arthropods and function as key components of both constitutive and induced defence systems. This review examines the structural diversity of terpenoids—including monoterpenes, sesquiterpenes, diterpenes, triterpenes, and tetraterpenoids —and their multifaceted functions in plant-arthropod relationships. These include plant–herbivore and plant-pollinator interactions, as well as multitrophic interactions between herbivores and carnivores at higher trophic levels, in which plant volatile organic compounds (VOCs) serve as signalling compounds. Terpenoids serve as direct defences through toxicity, deterrence, and growth inhibition of herbivorous arthropods. The volatility and chemical properties of different terpenoid classes influence their ecological roles, with smaller monoterpenes often acting as airborne signals and larger compounds functioning in localised defence. Additionally, some arthropods have evolved mechanisms to sequester, detoxify, or exploit plant terpenoids for their own defence or communication, thereby affecting carnivores through trophic cascades. The essay also explores the evolutionary arms race between plants and arthropods, the genetic and biochemical basis of terpenoid biosynthesis, and the environmental factors influencing terpenoid production and emission. Understanding terpenoid diversity and function has significant implications for pest management strategies, crop protection, and the development of sustainable agricultural practices.</p>