In the pharmaceutical industry, a nondestructive and real-time monitoring method is a promising analytical technology to guarantee the quality of the manufactured products. This study develops a novel nondestructive monitoring method based on the terahertz time-domain attenuated total reflection spectroscopy (THz–ATR) system, which can be used for measuring the optical constants of liquids circulating over the surface of the ATR prism. We focused on controlling moisture content in ethanol, which is used as a solvent in the chemical reactions. In the pharmaceutical industry, even a small amount of water in the solvent may cause problems in chemical reactions during research for purposes such as drug discovery. A continuous and nondestructive monitoring method for the moisture content in the solvent is essential because general moisture measurements are destructively. Our results demonstrate that the moisture content of ethanol can be determined by monitoring the refractive index of the liquid in the THz range. In other words, a simple method that only monitors the THz absorption is sometimes inadequate for ethanol. The proposed system can successfully evaluate the ethanol concentration or moisture content continuously and nondestructively. This method is a promising solution for the real-time measurements of chemical reactions for quality control in pharmaceutical manufacturing. [ABSTRACT FROM AUTHOR]