Terpenes constitute a distinct class of natural products that attract insects, defend against phytopathogenic microbes and combat human diseases. However, like most natural products, they are usually made by plants and microbes in small amounts and as complex mixtures. Chemical synthesis is often costly and inefficient, and may not yield enantiomerically pure terpenes, whereas large-scale microbial production requires expensive feedstocks. We engineered high-level terpene production in tobacco plants by diverting carbon flow from cytosolic or plastidic isopentenyl diphosphate through overexpression in either compartment of an avian farnesyl diphosphate synthase and an appropriate terpene synthase. Isotopic labeling studies suggest little, if any, metabolite exchange between these two subcellular compartments. The strategy increased synthesis of the sesquiterpenes patchoulol and amorpha-4,11-diene more than 1,000-fold, as well as the monoterpene limonene 10-30 fold, and seems equally suited to generating higher levels of other terpenes for research, industrial production or therapeutic applications.