Much qualitative research has drawn an association between social media and domestic terrorism, with the studies reaching different conclusions. However, few empirical studies have evaluated whether the surge in social media participation affects domestic terrorist events. Controlling for common explanations in the literature, we conduct a cross-national, time-series analysis of up to 151 countries from 2000 to 2019 to assess the impact of social media penetration on domestic terrorism. We find that greater social media penetration increases the likelihood of domestic terrorism in countries as it supports extremists’ ability to recruit, mobilize, and train terrorists. Using mediation analysis, we also find that greater social media penetration amplifies online and political polarization, increasing the likelihood of domestic terrorism events. Our work indicates the possible mechanisms linking social media and domestic terrorism and the need to develop and apply appropriate counterterrorism strategies to mitigate terrorist operations.