In the late 18th century the Habsburg Monarchy erected the fortress, as well as a large walled town directly across the Ohře River, near its confluence with the Elbe River, and named it after Empress Maria Theresa.
Construction started in 1780 and lasted ten years. The total area of the fortress was 3.89 km². The fortification was designed in the tradition of Sébastian le Prestre de Vauban. In peacetime it held 5,655 soldiers, and in wartime around 11,000 soldiers could be placed here, and neighbouring areas could be inundated. Fortress Josefov in eastern Bohemia was built at the same time and had a similar purpose.
The fortress was never under direct siege. During the Austro-Prussian War, on 28 July 1866, part of the garrison attacked and destroyed an important railway bridge near Neratovice (rail line Turnov - Kralupy nad Vltavou) that was shortly before repaired by the Prussians. This attack occurred two days after Austria and Prussia had agreed to make peace, but the Terezin garrison was ignorant of the news.
During the second half of the 19th century, the fortress was also used as a prison.
During World War I, the fortress was used as a political prison camp. Many thousand supporters of Russia (Russophiles from Galicia and Bukovina) were placed by Austro-Hungarian authorities in the fortress. Gavrilo Princip, who assassinated Franz Ferdinand, Archduke of Austria and his wife, died there of tuberculosis in 1918
