Alfred H. Terry was born in Hartford, Connecticut and raised in New Haven, Connecticut. He graduated in 1848 from Yale Law School and became a lawyer and clerk of superior court in New Haven.
At the outbreak of the Civil War, Terry raised a regiment of Connecticut volunteers and became the regiment's colonel. After fighting at the First Battle of Manassas, the unit was transferred to South Carolina. In April 1862, Terry was promoted to brigadier general of volunteers and put in command of the Morris Island Division, X Corps. In 1863, the division participated in siege operations at Charleston and was engaged in the September 1863 capture of Fort Wagner on Morris Island, made famous by the film Glory in 1989. Following the capture of Fort Wagner, the X Corps was sent to Virginia and placed under Gen. Benjamin Butler in the Army of the James. In May 1864, the unit participated in the Bermuda Hundred Campaign, and, in September 1864, they fought at the Battle of New Market Heights.
In January 1865, Terry was placed in command of the Fort Fisher Expeditionary Corps. Butler had failed to capture Fort Fisher in a December 1864 attempt, and was replaced by his former subordinate, Terry. On January 15, 1865, Terry's forces captured the fort, but Terry ceded overall command of the Wilmington Campaign to Maj. Gen. John Schofield later that month. For his efforts at Fort Fisher, Terry was promoted to major general of volunteers and brigadier general in the regular army. He commanded the X Corps for the remainder of the Carolinas Campaign.
Terry remained in the army after the war. He spent the rest of his career in the west, fighting in the Indian Wars. In 1868, he helped negotiate the Treaty of Fort Laramie. He commanded a column of troops in the 1876-77 Centennial Campaign. He fought in the Nez Perce War. In 1886, he was promoted to major general and placed in command of the Division of Missouri. Terry died on December 16, 1890.