This article investigates the possible role of the regional underdevelopment of South Eastern Turkey in the ensuing terrorism in the country. The article also aims at making a contribution towards a better understanding of some economic conditions that are related to terrorism. For this purpose, a novel approach to the examination of the roots of terrorism has been followed. First, we run Principal Components Analysis on total GDP and its components in South Eastern Turkey in order to reduce the number of potential explanatory variables. Second, we use the first three components in a logit regression where the dependent variable consists of an index of terrorist attacks. The results of the analysis have revealed that total GDP is helpful in explaining terrorism in Turkey. Furthermore, we find evidence that agriculture and government services are more important components of GDP in explaining terrorism than factors such as trade, construction, manufacturing and transportation.