- Terry composed the music for a Sony Playstation game called SkullMonkeys, the sequal to Douglas TenNapel's the NeverhoOd. Playstation Magazine called the theme music, "The best game music I've ever heard."
- Terry also composed much of the music for an independent film called Mothman, yet another creation from Douglas TenNapel. Fellow Dog and Eddie, Gene Andrusco "Eugene" is credited as music editor. Main title theme written and performed by Terry Taylor ,
Incidental theme arrangements by Gene Eugene and Terry Taylor, "Annie's theme", Written and arranged by Gene Eugene, "Point Pleasent" Written by Phil Madeira and Terry Taylor, Arranged by Phil Madeira, & Performed by Phil Madeira with Gene Eugene and Terry Taylor, "Lucky Spot" Written by Terry Taylor & Performed by "The Lost Dogs" (Terry Taylor: guitar, vocals, Gene Eugene: Keyboards, Phil Madiera: guitars, dobro, and steel guitar, Angie Lorenzen: vocals,
Frank Drennan: Harmonica and background vocals, & Anna Cardenas: backwards Mothman voice)
- Eric Henderson's Faces is released. Tim Chandler played bass.
- Tonio K's Rodent Weekend is releaesed on Gadfly Records. Tim Chandler played Bass; David Raven played drums; Rob Watson played keyboards.
- BrowBeats Presents Wither Wing is released on KMG Records. Terry cowrote "Happy Old Man" and provided vocals on that track and another one entited "Allison."
January 31, 1998
- Skullmonkeys is released for the Playstation. The video game features a soundtrack by Terry Taylor.
February 19, 1998
- The Insiderz' The Insiderz Present Skalleluia is released. Terry Taylor is credited with production assistance.
- Rich Young Ruler's Rich Young Ruler is released. Terry Produced and wrote some songs. Mike Roe played guitars. Gene Eugene coproduced and Dan Michaels is the Executive Producer.
April 9, 1998
- The Waiting's Blue Belly Sky is released on Sparrow Records. Rob Watson plays keyboards on the album.
April 21, 1998
- Terry Taylor and Friends perform about 15 minutes at the Ace of Clubs in downtown Nashville, for GMA week. Derri Daugherty, Steve Hindalong, Phil Maderia and Chris Donahue joined Terry for the show.
Set List: Broken Ladders to Glory, Ten Gallon Hat, Grace is the Smell of Rain, You Lay Down
June 1, 1998
- Steve Hindalong's Skinny is released on Cadence. Terry Taylor sings on "Skin Is Smooth." Tim Chandler Plays Bass on all but two tracks, as well as electric rhythm and lead guitars on "Diggin' Your Style".
June 30, 1998
- Surfonic Water Revival is released on KMG Records. Terry wrote, mixed and produced 12 of the songs on the album. He also sang backing vocals and played guitar on all tracks. Terry, DA & the Lost Dogs each performed one song.
July 2, 1998
- TST & Friends (Derri Daugherty, Steve Hindalong, Andy Prickett, Ed McTaggart, Tim Chandler and Phil Madeira) perform in Bushnell, Illinois at Cornerstone.
Set List: Through the Speakers, Theo's Logic, Endless Summer, Alarma!, Walls of Doubt, Ghost of the Heart, Big Guns, If You Want To, Safety Net, Driving In England, Billy Graham, Amber Waves Goodbye, Buffalo Hills, Grace is the Smell of Rain, Everyone Wore Hats, I Can't Take My Eyes Off Of You, Glory Road, Broken Ladders to Glory, I'll Get Over It, You Lay Down, John Wayne, Mr. Flutter, Ten Gallon Hat, Let's Spin!, Encore: The Pool, I Love You #19, Sanctuary, New Car!, The Happy Wanderer
July 4, 1998
- Terry Taylor and Ed McTaggart take part in a press conference in Bushnell, Illinois at Cornerstone. Later that day, TST & Friends (Steve Hindalong, Andy Pricket and Ed McTaggart) perform an acoustic show in the Prism tent at the festival.
Set List: Buffalo Hills, Amber Waves Goodbye, Broken Ladders to Glory, Grace is the Smell of Rain, Walls of Doubt, If You Want To, Ten Gallon Hat, You Lay Down, I'll Get Over It, John Wayne
- Meat The Farm Beetles, and Surfonic Water Revival were also sold at the festival, although Surfonic wasn't released to stores until later in the year.
- 7-Ball magazine runs two features in it's July/August issue, one about Surfonic Water Revival called 'Surfs Up' and the other an interview with Terry Taylor.
Terry Taylor Rides a New Wave
- DA's Our Personal Favorite World Famous Hits is released.
The CD's artwork was designed by Douglas TenNapel.
November 30, 1998
- Terry nearly takes part in an online chat with the Daniel Amos Discussion List. Due to computer problems - the questions had to be submitted via AOL instant messanger and then the answers were posted to the chat window.
- Terry co-produces a group out of Phoenix called Straw Theory
December 1998-January 1999
- The Giovanni Audiori catalog surveys a number of bands and artists, asking them what they're favorite top 10 albums of all time are.
Arthur Fhardy of the Swirling Eddies, David Raven, Rob Watson, Gene Eugene, Randy Stonehill, Phil Madeira, Ashley Cleveland, Mitch McVicker and others contribute lists. Mark Robertson, of This Train and Rich Mullins' Ragamuffin Band, includes "almost anything by Terry Taylor" on his list. Randy Stonehill names DA's "Doppelganger".