Real have won all eight finals they have contested since the Champions League replaced the European Cup in 1992. They have also won five Champions League titles in the past 10 seasons for a total of 14 European crowns.
Terzic said records were there to be broken, but Dortmund would need to perform at the highest level.
"We have to have the belief that we can achieve big things," Terzic told a press conference. "We have to invest everything to bring the trophy back to Dortmund. It has been a long time."
Dortmund won the title in 1997 and reached the final again in 2013, losing to Bayern Munich in an all-German showdown.
"The most important thing is if you want to win the Champions League you have to beat the champions," the coach said. "We now face the absolute champions."
"They have had this experience 14 times, won it five times in the past 10 years. But our aim is always to break it down to one game."
"Eight Champions League finals and they never lost. But what matters is not what happened in the previous eight. What matters is only the next one. It is time to break that run."
Dortmund finished fifth in the Bundesliga this season, narrowly securing their Champions League spot for next season. They had been title contenders after missing out on the league trophy on the final matchday in 2023.
Terzic said that bitter experience a year ago, however, contributed to their success this season.
"I had said it at the time that I would have done without this chapter of my life, but this day was from that point part of our road to success," he said.
"Now we travel to London with the same fans who a year ago after that bitter match (on the final Bundesliga matchday) kept supporting us and singing for hours. It is time to give something back, and we will have the chance to hopefully celebrate together."