An own goal from Daniel Majstorovic was enough to secure Terry's side the victory at a half-full Wembley.
Leading the troops: Terry captained England in their win over Sweden
Centre of attention: Terry was restored to the England line-up after missing the win over Spain
The Celtic defender headed past his own goalkeeper Andreas Isaksson - England's 2,000th goal - when under pressure from Gareth Barry.
Terry, pleased by the night's work, insisted he never thought about relinquishing the armband as he finds himself accused of racially abusing Anton Ferdinand at Loftus Road last month - allegations he strenuously denies.
Up for the battle: Terry played the full 90 minutes in the Wembley victory
'No chance,' he told ITV1. 'I would never step down. It (being England captain) is something I dreamed of as a boy.
'When I was four or five years old I used to watch England games and it's something I dreamed of being. I worked very hard to get here. I'm very passionate, very confident being England captain and very proud to be, also.
Back of the net: Barry's header came off Daniel Majstorovic for England's opener
Celebrate good times: Barry is congratulated as England celebrate their lead
'It's a great achievement, walking the side out, and I'm very proud to do that.'
Terry said of the Wembley crowd: 'I said yesterday the England fans have always been great with me and the players, they are always behind us win, lose or draw. They get upset at times - like we all do - we're very passionate and that's what makes us the very best.
Eye on the ball: Capello says he's learned a lot from the two friendlies
'We've got a great set of fans, and some great performances at the moment, so if we can keep that momentum for the next six months then hopefully things will be a lot better.'
England boss Fabio Capello was pleased with his side's performances against Spain and then Sweden without Wayne Rooney, who is suspended for the three Euro 2012 group games, subject to an appeal.
'I learned a lot,' Capello said on ITV1. 'It was important to see some players against two difficult teams. I'm happy with the experiments, the results were positive. For the future, these players will be okay.
'Without Rooney we changed the style, played three midfielders in a 4-3-3. I'm happy because we won the two games and this evening we created a lot of chances.
'I know Rooney is a really fantastic, important player, but the team spirit is important. I saw in these two games really good spirit.' Capello added: 'We created a lot of chances to score. Some of the players played really well - Phil Jones, Jack Rodwell - and I think it was a really testing game, because after 43 years we finally beat Sweden.
'I'm happy but I think we need to improve from it because when you've got the ball possession you need to move it a lot quicker.'
?England 1 Sweden 0: Rodwell and Jones do Capello proud as Young Lions break 43-year jinxEngland v Sweden: The international action as it happened Rooney D-Day: England's appeal over nightmare three-match Euro ban set for December 9
Source: Daily Mail
Source: Daily Mail