The terpenoid pathway serves as an essential source of all isoprenoid precursors and metabolites that are of great pharmacological importance. The major enzymes for the synthesis of these diverse molecules is the terpene synthases (TPSs), which catalyse the final step of the synthesis of the important secondary products, the terpenes. Previous studies have reported that the various environmental factors, including light govern the synthesis of terpenoids. However, the molecular components and steps involved in the regulation of synthesis of these molecules have not been studied in detail. In this study, we report that the light regulates the expression of the members of terpene synthase gene family in Arabidopsis thaliana. We demonstrate that ELONGATED HYPOCOTYL (HY5), a basic leucine zipper transcription factor, plays a crucial role in light-mediated transcriptional regulation of terpene synthase, AtTPS03. Expression analysis using hy5-215 mutant and HY5 over-expression lines revealed that HY5 acts as a positive regulator of AtTPS03. Additionally, studies including AtTPS03 Promoter::reporter transgenic lines in wild-type and hy5-215, as well as electrophoretic mobility shift assay (EMSA), suggest an interaction of HY5 with the AtTPS03 promoter. Together, our analysis indicate the requirement for HY5 for light-mediated regulation of AtTPS03 for the terpenoid biosynthesis in Arabidopsis.