Terahertz (THz) has laid a foundation for applying terahertz time-domain spectroscopy (THz TDS) in material detection, structure resolution, qualitative and quantitative analysis due to its unique characteristics of perspective, security and high spectral resolution. As the prevention or treatment of human diseases, drugs have always been closely related to people’s lives. However, recently the news of drugs endangering people’s health is often seen due to their quality problems. There are more and more calls for effective drug detection methods. THz-TDS, as a new non-destructive detection technology, has been gradually applied to drug detection. Thus, in this paper, we studied the THz absorption spectra of paracetamol using THz-TDS. Firstly, the THz spectra of paracetamol were measured in the range of 0.3~4.5 THz. Six characteristic absorption peaks and one shoulder peak were obtained. Specifically, these peaks are located at 1.46, 1.88, 2.11, 2.52, 2.95, 3.48 and 4.27 THz. Then, the simulation calculation based on isolated-molecule density functional theory was carried out. It was found that the intramolecular vibrations contributed to the experimental peaks. However, the -isolated-molecule simulation cannot interpret the measured peaks completely because intermolecular forces are not taken into account. Then the solid-state simulation was performed to interpret the measured peaks. Depending on the comparison between experimental and theoretical results, it was found that the absorption peaks of 1.46 and 2.11 THz are caused by the combination of intermolecular and intramolecular forces, the absorption peaks of 1.88, 2.52 and 2.95 THz mainly come from the intermolecular forces, and the absorption peaks of 3.48 and 4.27 THz primarily originate from the intramolecular forces. Finally, the THz absorption peaks of commercial paracetamol tablets in the range of 0.3~2.75 THz before and after the deterioration were measured. According to the comparison, it was found that the absorption peaks of commercial tablets and paracetamol samples were completely matched, indicating that the drug can be calibrated by the THz characteristic peak. Besides, the THz characteristic peaks in CNR measurement are all disappeared, implying that intermolecular forces mainly contribute the THz peaks of 1.46 and 2.11 THz. On the other hand, it also suggested that the corresponding THz absorption peaks of drugs would be changed with chemical properties. A new characteristic absorption peak at 0.69 THz emerged in the CNR measurement, indicating that the new intermolecular forces have been formed and the new physicochemical functions are produced after deterioration.