Display omitted •Cyclodextrin-terpene complexes are promising host-guest systems.•Insolubility in water and a short life-time limit the therapeutic use of terpenes.•CD inclusion complexes enhance bioavailability, pharmacological efficacy and safety of terpenes. Terpenes constitute the largest class of natural products and are important resources for the pharmaceutical, food and cosmetics industries. However, due to their low water solubility and poor bioavailability there has been a search for compounds that could improve their physicochemical properties. Cyclodextrins (natural and derived) have been proposed for this role and have been complexed with different types of terpenes. This complexation has been demonstrated by using analytical techniques for characterizing complexes such as DSC, NMR, XRD, FTIR, and TGA. The formation of inclusion complexes has been able to improve drug characteristics such as bioavailability, solubility and stability; and to enhance biological activity and efficacy. This review shows strong experimental evidence that cyclodextrins improve the pharmacological properties of terpenes, and therefore need to be recognized as being possible targets for clinical use.