The purpose of this study was to investigate the effectiveness and mechanism(s) of percutaneous absorption of propranolol hydrochloride (PHCL) across rat and human cadaver skin using seven novel terpenes with reference to marker terpene 1,8-cineole. In-vitro skin permeation studies were carried out via rat and human skin models. The mechanism of skin permeation of PHCL by terpenes was evaluated by FTIR, DSC, activation energy measurement and histopathological examination. Amongst the new terpenes, 1,4-cineole was found to be most effective enhancer for diffusion of PHCL through rat skin (ER=3.07) and human cadaver skin (ER=2.42) as compared to control. FTIR spectra and DSC thermogram of skin treated with aforesaid terpenes indicated that permeation occurred due to the disruption of lipid bilayers. No apparent skin irritation (erythema, edema) was observed on treatment of skin with terpenes, the irritation was higher with the β-citronellene and rose oxide. It was concluded that 1,4-cineole can be successfully used as potential permeation enhancer for PHCL. It enhanced the absorption of hydrophilic drug by extraction and disruption of lipid bilayers and keratin denaturation of stratum corneum.