 Terrero was lieutenant general before he became Governor General of the Philippines on April 4, 1885 due to his appointment to the post by Praxedes Mateo Sagasta, then Prime Minister of Spain.Terrero started out as a new Carlist, but after seeing first hand the abuses and avarice of the friars and their blatant disregard of the laws of the land, he gradually abandoned his absolutist and apostolic Carlist convictions and was transformed into a liberal, reform-minded and anti-clerical Governor General.He took part in the Carolinas dispute between Spain and Germany in 1885, in which the friars funded construction of a ship named "Crucera Filipina" in 1886.