To date, all free-living adult hairworms have been reported from aquatic habitats. However, in Oklahoma, a recently described gordiid, Gordius terrestris, is consistently encountered in terrestrial habitats. We found this gordiid species has a unique egg morphology, unlike that of any other hairworm species, with an outer shell separated by distinct space from a thick inner membrane surrounding the developing larva. Because of this unique egg morphology and the occurrence of free-living hairworms in terrestrial habitats, it was hypothesized that G. terrestris represents the first report of a hairworm species with a terrestrial life cycle. In this study, we observed thousands of free-living adult worms in terrestrial habitats such as wet lawns and underneath wet sod during the winter. We found evidence of worms mating in these terrestrial habitats, followed by female worms burrowing and ovipositing in the soil. In the laboratory, significantly more females burrowed in the soil than males, providing a plausible explanation for the extreme male-biased sex ratio observed for free-living worms found on wet lawns. Finally, we collected terrestrial earthworms infected with the cyst stage of this gordiid species in the field and confirmed those observations by infecting earthworms with G. terrestris larvae in the laboratory. Taken together, these observations strongly support the hypothesis that G. terrestris has a terrestrial life cycle.