Terrorism, as one of major tactics that rebel groups utilize during civil wars, has not been commonly related to the civil war studies. It is found that during a civil war, while some rebel groups operate high level of terrorist attacks, other rebel groups rarely use terrorism. This divergence can be caused by several conditions, such as regime type, and group strength, which have been examined by other scholars. The contribution of this treatise is that it proposes two alternative hypotheses based on a two-level game theory that few scholars have analyzed, specifically, the macro-level on the competitions among rebel groups, and the micro-level on the organizational structure within a rebel group. The findings suggest that the two conditions might not directly lead to the rebel groups’ tactic transition from other tactics into terrorism, but they indeed have effects on the frequency of the use of terrorism tactic by rebel groups.