Vanadium dioxide (VO2) is a fascinating material thanks to its unique insulator metal transition (IMT) at 68 °C which is very close to the room temperature. This reversible change in electrical resistivity is around several orders of magnitude and the electrical change accompanied by optical and structural change as well. Thanks to these unique properties vanadium dioxide material has been studied intensively past decades. This phase transition allows us to apply the transition properties widen application such as field effect transistor (FET), uncooled bolometers, tunable metamaterial filters, high data rate wireless communication etc. Especially for terahertz region which is the most unexplored region of the electromagnetic spectrum, vanadium dioxide is a promising material having ability to modulate terahertz waves by IMT phenomena. In this work, vanadium dioxide (VO2) thin films fabricated by reactive DC magnetron sputtering method and its properties optimized to minimize the amounts of secondary phases by optimizing the oxygen concentration, sputtering power and deposition time. Samples which show the maximum resistivity change during the transition have been used for the terahertz modulation experiments. It has been observed that when the VO2 samples triggered by continuous wave (CW) laser, VO2 transforms to the metallic phase, behave as an opaque material to the terahertz wave. At room temperature, in insulating phase it is partially transparent to terahertz radiation. These results indicate that VO2 thin films can be a good candidate for THz wave modulators.