Hydrogen bonding properties of water molecules, which are confined in microcavities of biological interfaces, are significantly different from those of bulk water and drive most of the complex biological processes. While NMR, X-ray and UV–vis-IR spectroscopic techniques have been found inadequate for describing the dynamics of the thick (20–40 Å) sheath of hydration layer around biomolecules, recently developed THz spectroscopy has emerged as a powerful technique to directly probe the collective dynamics of hydrogen bonds in the hydration layer, which control all important functions of the biomolecules in life. Both laser and accelerator-based THz sources are intense enough to penetrate up to about 100 μm thick water samples, which makes THz transmission and/or dielectric relaxation measurements possible in aqueous solutions. These measurements provide valuable information about the rattling and rotational motions of hydrated ions, making, breaking and rearrangement of hydrogen bonds in hydration layer as well as hydrophilic and hydrophobic interactions between biomolecule and water. THz spectroscopy has also been successfully applied to study the effect of modulation of the physical conditions, like temperature, pH, concentration of proteins and chemical additives, on the structure and dynamics of hydration layer. THz spectroscopy has also been applied to study the processes of denaturation, unfolding and aggregation of biomolecules.