Terry has been named as Aston Villa's assistant manager.
Villa made a late announcement on Wednesday to confirm that Smith would be replacing Steve Bruce as manager of the Championship outfit, leaving Brentford after more than three years at Griffin Park.
Smith, 47, took Brentford to three top-10 finishes in the Championship on a limited budget, but question marks arose when it was suggested that he would not be taking his right-hand man Richard O'Kelly with him from Brentford.
But it has since been confirmed that O'Kelly will join Villa, but not as Smith's assistant as he was at Brentford. It remains unclear what role O'Kelly will be given, but Terry will be the club's assistant and confirmed as much on Instagram.
Terry left Villa in the summer after his contract expired at the club, despite captaining the Midlands outfit to the Championship play-off final where they ultimately suffered a 1-0 loss to Fulham.
Smith won the role as Bruce's replacement, with the likes of Thierry Henry, Rui Faria, Brendan Rodgers, Eddie Howe and many others linked to the role.