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Terror dogs are found only in Tarn's Lair, which you access at the end of the miniquest of the same name. Getting back to the lair to fight terror dogs is either the most annoying and difficult journey in the game, or the easiest: it all depends on whether or not you can make rings of slaying.
If you can make slayer rings, then just rub one and choose "Tarn's Lair" -- you'll teleport to the chamber just outside the door to the lair -- perfect!
If you haven't unlocked the ability to make the rings, you have to go all the way through the lair again as you did while doing the minigame. As you may remember, this requires yo to travel to the Haunted Mine near Burgh de Rott, then navigate a confusing maze of deadly traps and aggressive enemies. Frankly, I don't consider this worth the bother to do, nor worth the bother for me to explain! If you really want to do it, there's a map with pretty good directions at Tip.It.
Note that prayer points rapidly drain away whenever you are in the lair -- in fact, they drain faster than they do at the Barrows, and there's no way to stop it.
Equipment
If you are using rings of slaying, wear high defence Barrows armor, and just plan to bank regularly since getting to the lair is easy. If you can't use the rings, I recommend Guthans, using a whip or other primary weapon and switching to the warspear as needed. The Guthans will allow you to heal so you can get all the kills you need for a Slayer assignment, for example.
There are no safe spots in the lair. You can trap the terror dogs using walls but this won't work until they are aggressive, and in the meantime rangers and mages will get hit very hard -- not recommended.
Supplies
Super sets are strongly recommended, as is an inventory of high-quality food. Also bring several sets of alching runes.
If you're planning to bank frequently, bring a 2-dose super set and a load of cheapish food. Longer trips require better food, of course (though you need not use the expensive pineapple pizzas I used in my logs -- they were cheap in 2008.)
Be sure to bring a duelling ring or some other means of teleporting out (or you can use Home Teleport as long as you plan carefully so you don't try to use it too often).
Familiar
If you want to pick up and bank big bones, bring a beast of burden. If you plan to stay for a while, use a healing familiar.
Combat Notes
There are five Terror Dogs (Level 100) and and four Terror Dogs (Level 110) in the lair. There are three main combat differences between them: the level 110s are bigger in appearance, they hit harder and they have slightly more life points. In terms of drops the level 100 and level 110 dogs are the same, except the level 100s drop regular bones and the 110s drop big bones.
The entire lair is so evil that your prayer points rapidly drain away whenever you are in it. This happens continously, and so quickly in fact that even trying to restore it with potions is pointless -- you must just fight without prayer. Combine the lack of protection prayers with the fact that the terror dogs are aggressive, and the area is multicombat, and you have quite a challenge on your hands.
I strongly recommend sticking to the corners and edges of the lair, rather than going right into the center -- this limits the number of dogs that can attack you at once. Also try to stay in the same spot for as long as possible; if you are successful, after about 10 minutes the monsters lose aggressiveness, which helps a great deal.
Don't forget that at any time you can easily leave the lair through the door you used to enter, if you need to take a break, pot up, heal or whatever.
Drop Notes
Given that these monsters are in a multicombat area where Prayer is unusable, their drops are pathetic. In essence, they have the same drops as blue dragons -- except for the dragonhides and dragon bones. If you think about the secondary drops of blue dragons, that's about what you should expect here, and that's not a pretty sight.
The special drop of terror dogs is the granite helm, an item that was close to obsolete the day it was released and is now worth very little.
The only upside to these is that they drop a good amount of blue charms, but there are better ways to get those.
There are more of the level 100 terror dogs than the level 110 ones, but you often kill more 110s because they are more concentrated in the center of the lair. Their drops only differ in that the smaller ones drop bones, the bigger ones big bones.
