Situated in the center of the seismically active Himalayan concave chain, Nepal faces significant earthquake risk. One of the consequences of these earthquakes is soil liquefaction, which can lead to structural failure, property damage, and loss of life. The Terai region, characterized by its dense population and rapid urbanization, is vulnerable to soil liquefaction due to its loose, saturated sandy, and silty deposits, coupled with poor drainage conditions. Despite this risk, there is a lack of comprehensive studies on liquefaction in this area. This study analyzes the data from 153 boreholes across 52 locations to assess the likelihood of soil liquefaction in the Terai region of Nepal. Liquefaction potential index (LPI) was evaluated using factor of safety (FOS) considering Mw 7.8 earthquake scenario. The liquefaction potential map was developed which identified varying risk zones in the region. The result demonstrates 5.42% of the area is classified under very high liquefaction potential, 31.12% under high, and 63.46% under low risk. Comparing the findings with the previous study, difference in the methodology used led to variation in the extent of high-risk zone. This study fills a critical gap in understanding liquefaction risk in the Terai region and highlights the need for safe and sustainable engineering structures. Proactive measures and preparedness are essential to mitigate the hazard and enhance infrastructure resilience in these seismically active areas.