Terpenoids (isoprenoids) represent the largest and most diverse class of chemicals among the myriad compounds produced by plants. Plants employ terpenoid metabolites for a variety of basic functions in growth and development but use the majority of terpenoids for more specialized chemical interactions and protection in the abiotic and biotic environment. Traditionally, plant-based terpenoids have been used by humans in the food, pharmaceutical, and chemical industries, and more recently have been exploited in the development of biofuel products. Genomic resources and emerging tools in synthetic biology facilitate the metabolic engineering of high-value terpenoid products in plants and microbes. Moreover, the ecological importance of terpenoids has gained increased attention to develop strategies for sustainable pest control and abiotic stress protection. Together, these efforts require a continuous growth in knowledge of the complex metabolic and molecular regulatory networks in terpenoid biosynthesis. This chapter gives an overview and highlights recent advances in our understanding of the organization, regulation, and diversification of core and specialized terpenoid metabolic pathways, and addresses the most important functions of volatile and nonvolatile terpenoid specialized metabolites in plants.