This work proposes and examines the feasibility of next-generation 0.3 THz phase shifters realized with liquid crystals (LCs) as tunable dielectrics coaxially filled in the transmission line. The classic coaxial transmission line topology is robust to electromagnetic interference and environmental noise, but is susceptible to higher-order modes from microwave to millimeter-wave towards terahertz (THz) wavelength ranges, which impedes the low-insertion-loss phase-shifting functionality. This work thus focuses primarily on the suppression of the risky higher-order modes, particularly the first emerging TE11 mode impacting the dielectric loss and metal losses in diverse manners. Based on impedance matching baselines at diverse tuning states of LCs, this work analytically derives and models two design geometries; i.e., design 1 for the coaxial geometry matched at the isotopically referenced state of LC for 50 Ω, and design 2 for geometry matched at the saturated bias of LC with the maximally achievable permittivity. The Figure-of-Merit for design 1 and design 2 reports as 35.15°/dB and 34.73°/dB per unit length, respectively. We also propose a constitutive power analysis method for understanding the loss consumed by constitutive materials. Notably, for the 0.3 THz design, the isotropic LC state results in an LC dielectric loss of 63.5% of the total input power (assuming 100%), which becomes the primary constraint on achieving low-loss THz operations. The substantial difference in the LC dielectric loss between the isotropic LC state and saturated bias state for the 0.3 THz design (35.76% variation) as compared to that of our past 60 GHz design (13.5% variation) indicates that the LC dielectric loss’s escalating role is further enhanced with the rise in frequency, which is more pronounced than the conductor losses. Overall, the results from analytical and finite-element optimization in this work shape the direction and feasibility of the unconventional THz coaxial phase shifting technology with LCs, actioned as continuously tunable dielectrics.