Abstract In recent years, terahertz (THz) technology has emerges as a promising research area in materials science, driven by its potential for vast applications. Notably, its unique characteristics – being nonionizing, safe for human health, and nondestructive‐ set it apart from conventional techniques like X‐ray radiation, particularly in the characterization of nonconducting materials. This study explores the potential of THz technology in investigating various material properties relevant to pure textiles and textile‐based composite structures. The findings demonstrate the effectiveness of THz technology in identifying textile types, determining blend ratios, detecting defects and damage in textile goods, and inspecting internal defects such as delamination, debonding, and porosity in fiber‐reinforced composites. This review also highlights the future insights of THz technology in the textile and composite industry and concludes that, despite existing challenges, it can unlock new opportunities across industries.