Terror was a mental debuff that could be inflicted by enemies with an active skill that could cause it or passively when the level disparity between them was high.
It would usually just stun the players and the duration of it was determined by how high their Will stat was. Most of the mental debuffs' effectiveness was determined through the Will stat and as such it had importance that most players wouldn't realize until later.
In the early to mid game, most of the foes they encountered didn't have such skills and even if they did they were not as effective. A couple to 10 seconds of stun was something players could still handle.
But as they grew and progressed through the game, they would start encountering stronger foes that could easily inflict them with terror. Granted the duration of stun through it might be smaller, but with multiple foes using it at once, things ramped up really fast.
