Terahertz (THz) technology offers unparalleled opportunities in a wide variety of applications, ranging from imaging and spectroscopy to communications and quality control, where lack of efficient modulation devices poses a major bottleneck. Spatial modulation allows for dynamically encoding various spatial information into the THz wavefront by electrical or optical control. It plays a key role in single-pixel imaging, beam scanning and wavefront shaping. Although mature techniques from the microwave and optical band are not readily applicable when scaled to the THz band, the rise of metasurfaces and the advance of new materials do inspire new possibilities. In this review, we summarize the recent progress of THz spatial light modulators from the perspective of functional materials and analyze their modulation principles, specifications, applications and possible challenges. We envision new advances of this technique in the near future to promote THz applications in different fields.