William R. Terry was born in rural Liberty in Bedford County, Virginia, to William Terry and Lettie Johnson Terry. He entered the Virginia Military Institute in July 1846 and graduated on July 4, 1850, ranking 15th in a class of 17 cadets. He then attended the University of Virginia and became a prosperous merchant and farmer. In 1856, he married Mary Adelaide Pemberton (died 1910). The couple had three sons and three daughters. Terry died in Chesterfield Court House, Virginia, and is buried in Hollywood Cemetery in Richmond.