Aquaculture plays a key role in providing nutrition and livelihood security. Rapid intensification has been adopted in aquaculture to increase fish production, often leading to a stressful environment resulting in poor growth, compromised immune functions, and increased susceptibility to infections in fish. The use of synthetic chemicals, hormones, and antibiotics for growth promotion and disease control has resulted in the development of antimicrobial resistance and raised concerns about public health. There is a critical need to explore environmentally friendly alternatives for sustainable aquaculture. Plants contain a wide range of chemical substances and have shown their beneficial effects on fish growth, immunity, and health. Terpenes and terpenoids are among such natural products with a wide array of antimicrobial, growth-promoting, antioxidant, immune-stimulating, and anti-inflammatory effects in human and higher vertebrates. Terpenes are a broad class of natural secondary metabolites found in plants that have the potential to enhance immune systems, combat microbes, and strengthen antioxidant defences, thereby promoting aquatic animal health. While studies have explored the positive effects of compounds such as terpenes, phenolic compounds, saponins, and alkaloids in aquaculture, the utilization of terpenes and their derivatives remains underexplored. This review seeks to consolidate and emphasize the advantageous effects of terpenes and their derivatives on fish health, potentially expanding their use in aquaculture.