This paper argues that early Terena (‘Guaná’) had a contrast between fricative and affricate consonants that has been lost in modern Terena. Evidence for this claim comes from the examination of late 19^th century and early 20^thcentury documents on the language. The existence of the relevant phonemic contrast is revealed not only by an analysis of the transcriptions employed in these early sources but, more importantly, by a demonstration that fricatives and affricates were treated differently in the history of the language. It is proposed that, after the early Terena voiceless fricatives were debuccalized, merging with early Terena h, the affricates started to include fricative realizations in their allophonic range. This scenario is consistent with descriptions of modern Terena that stress the ‘archaic’ character of affricate realizations of /ʃ/.