The Chelsea centre-back scored the second goal and was involved in setting-up the first, albeit illegally, as Jose Mourinho's men sent Birmingham City crashing out.
The Londoners made the perfect start when they took the lead after just six minutes.
Following good early pressure, the second of two quick corners produced a marvellous header by German international centre-back Robert Huth.
He arrowed home a powerful header that gave goalkeeper Maik Taylor no chance from six yards. However, Terry's involvement was suspect to say the least.
The Chelsea captain, a certain candidate for player of the season, blocked Birmingham centre-back Martin Taylor, allowing Huth a free run at the header.
The training ground routine worked perfectly and Chelsea went on to dominate the first half.
The home side could have had a couple more goals to seal the game.
First Damien Duff saw a wayward right footer deflected for a corner, before smashed a left-foot shot against the crossbar from a Duff corner.
Chelsea made three second-half changes and this caused a lack of cohesion which Birmingham failed to capitalise on.
After 52 minutes City midfielder Darren Anderton produced a wonderful right-foot half volley which forced Chelsea goalkeeper Carlo Cudicini into an excellent save.
Five minutes later, the visitors had a good shout for a penalty turned down by referee Mike Dean when Anderton's long-range shot appeared to be blocked by Terry's left arm.
Terry's shoddy back header to Cudicini could have caused the centre-back some embarrassment after 66 minutes but the Italian shot-stopper intercepted the ball before the on-running Robert Blake could capitalise.
But Terry calmed the nerves of the Chelsea faithful ten minutes from time when he popped up at the other end and headed a Frank Lampard pass beyond the despairing dive of Maik Taylor.
Chelsea then took off the injured Huth and played out the closing minutes with only ten men.