Terrytown was founded in 1949 by Terry Carpenter, a Scottsbluff businessman and Nebraska state senator, who gave the new city his own name. It sits directly on the North Platte River between Scottsbluff and Gering.

Terrytown had a 2020 population of 1,057 and, having no ZIP code of its own, shares Gering's 69341. Public bus service via the Tri-City Roadrunner began in January 2018, connecting it with its larger neighbors.