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Terraform

by HashiCorp (an IBM company) · CLI tool · also known as HashiCorp Terraform, HCP Terraform, Terraform Cloud

Infrastructure-as-code tool that provisions cloud and SaaS resources from HCL configurations through a plan-and-apply workflow, licensed under BSL 1.1

BUSL-1.1 licenseFreePaidEnterpriseUsage-basedLocalCloudSelf-hostable
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Link verified Nov 2, 2026

Overview

Terraform is the infrastructure-as-code tool from HashiCorp, now part of IBM. Users describe the desired resources, such as virtual machines, DNS records, Kubernetes objects or SaaS settings, in the HashiCorp Configuration Language; terraform plan computes the difference between that description and the recorded state, and terraform apply performs the changes through provider plugins. Thousands of providers on the Terraform Registry cover the major clouds and a long tail of services including Cloudflare, Hetzner, OVHcloud, Tailscale and Grafana.

State is stored locally or in a remote backend; HCP Terraform (formerly Terraform Cloud) and the self-managed Terraform Enterprise add remote runs, policy enforcement, a private registry and team workflows. Since version 1.6 the source is released under the Business Source License 1.1, which allows most use but prohibits building a competing hosted service; this change prompted the OpenTofu fork.

Terraform is declarative and provisioning-oriented, so configuring software inside machines is usually left to Ansible or cloud-init, and the state file becomes a sensitive artifact that must be protected and locked.

Capabilities

  • Declarative resources in HCL with dependency graph planning
  • Provider plugin ecosystem via the Terraform Registry
  • Remote state backends with locking
  • Modules for reusable infrastructure components
  • HCP Terraform and Terraform Enterprise for remote runs, policy and private registries
  • Import of existing resources into state

Typical workflows

  1. Provision servers, DNS and networking across providers from one repository
  2. Review infrastructure changes through plan output in pull requests
  3. Run applies centrally with HCP Terraform workspaces

Strengths

  • Largest provider ecosystem for infrastructure as code
  • Well-documented language and workflow
  • Hosted and enterprise options from the vendor

Limitations

  • Business Source License is not OSI-approved open source
  • State files are sensitive and must be protected
  • Not intended for in-machine configuration management

Prerequisites

  • Credentials for target providers
  • A state backend for team use

Who it is for

  • Infrastructure and platform engineers
  • Teams standardizing cloud provisioning

Alternatives & comparison

OpenTofu is the MPL-2.0 fork with near-identical syntax and the same providers, chosen by teams who object to the BSL. Ansible handles configuration inside machines procedurally and is commonly run after Terraform has provisioned them.

  • Ansible

    Agentless configuration management and orchestration tool that runs YAML playbooks over SSH, with collections for clouds, network gear and applications

    Open sourceOpen source
  • OpenTofu

    Community fork of Terraform under the Linux Foundation, keeping the HCL language, provider ecosystem and state model under the MPL-2.0 license

    Open sourceOpen source
Compare Terraform with its alternatives →

Sources & verification

Primary sources consulted for this record. Claims are tied to the fields each source supports; the automated link checker re-verifies every URL on a schedule.

  • License
    Terraform LICENSE (Business Source License 1.1)

    https://github.com/hashicorp/terraform/blob/main/LICENSE

    Supports: license_spdx, source_model, vendor

    Licensor named as International Business Machines Corporation (IBM).

    checked Nov 1, 2026
  • Official documentation
    Terraform Documentation

    https://developer.hashicorp.com/terraform/docs

    Supports: capabilities, workflows

    checked Nov 1, 2026
  • Official site
    Terraform | HashiCorp Developer

    https://developer.hashicorp.com/terraform

    Supports: name, summary

    www.terraform.io redirects here.

    checked Nov 1, 2026
  • Pricing page
    HashiCorp Pricing

    https://www.hashicorp.com/en/pricing

    Supports: pricing_model

    Lists HCP Terraform tiers Essentials, Standard, Premium and Terraform Enterprise.

    checked Nov 1, 2026
Confidence
High
Reviewed
Nov 1, 2026
Links
Verified · Nov 2, 2026

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