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Terra Moss is a crop added by Roots 2. It is obtained by placing 2 spruce saplings, 2 spruce leaves and 1 grass in a Moonlight Circle, as outlined in the Book of Herblore. When all items are at full growth, a light effect will be seen and the central item will be transformed into Terra Moss. The crop can then be obtained by right clicking, which will give both the crop and Terra Moss Spore. This can then be grown on irrigated dirt as with vanilla crops, meaning that the ritual only needs to be performed once.
Although the Book of Herblore states that this transformation takes place under moonlight, this is incorrect.