The decision comes a day after Liverpool striker Luis Suarez was banned for eight matches on Tuesday and fined 40,000 pounds by the FA for racially abusing Manchester United defender Patrice Evra during another game earlier this season.
Terry will appear in court on February 1 and could be fined up to 2,500 pounds if found guilty. That is a fraction of his weekly wage but the damage to his image could be more costly.
Police had been investigating a complaint that Terry racially abused Ferdinand during Chelsea's 1-0 defeat by their west London rivals in October.
The complaint came after video footage of the incident was posted on the Internet.
"I am satisfied there is sufficient evidence for a realistic prospect of conviction and it is in the public interest to prosecute this case," Alison Saunders, Chief Crown Prosecutor for London said in a statement.
"Mr Terry will appear before West London Magistrates' Court on 1 February 2012."
Terry has repeatedly denied making a racist comment to Ferdinand, younger brother of the England captain's long-time international team mate Rio.
"I am disappointed with the decision to charge me and hope to be given the chance to clear my name as quickly as possible," Terry said in a statement reported by British media.
"I have never aimed a racist remark at anyone and count people from all races and creeds among my closest friends.
"I will fight tooth and nail to prove my innocence."
"I have campaigned against racism and believe there is no place for it in society," he added.
Chelsea, who play at Tottenham Hotspur on Thursday, stood by their captain, a hero with the club's fans for his loyalty and commitment, and he remains available for selection.
"John has made it clear he denies the charge and is determined to do all he can to prove his innocence," the club said in a statement on their website.
"Chelsea FC has always been fully supportive of John in this matter and will continue to be so. The club finds all forms of discrimination abhorrent and we are proud of the work we undertake campaigning on this important issue."
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