A method to detect production faults in plastic packages using terahertz (THz) radiation is presented. Relying on the large difference between the absorption coefficients of plastic and water (for water-filled defects), and on the refraction index difference between plastic and air (for air-filled defects), our technique consists of focusing and scanning a terahertz beam on the sealed area of the package, followed by the detection of the transmitted signal. Compared to previous methods such as visual and ultrasound inspection, our technique can be applied for optically opaque packages and does not require immersion in a matching liquid. We tested our terahertz system on defects simulated by water-filled and air-filled round channels imbedded in polyethylene films, with diameters ranging from 10 to 100 μm. The results show that detection is possible down to 30 μm for water-filled and 40 μm for air-filled channels. The results are the same for both transparent and opaque packages. © 2005 Society of Photo-Optical Instrumentation Engineers.