Studies in terahertz (THz) imaging have revealed a significant difference between skin cancer (basal cell carcinoma) and healthy tissue. Since water has strong absorptions at THz frequencies and tumor affects the water content of tissue, a likely contrast mechanism is variation in water content. Modeling the propagation of a THz pulse through water is the first step toward understanding the origin of contrast in terahertz pulsed images of skin cancer. In this letter, we develop a finite-difference-time-domain simulation to model the propagation of a THz pulse and incorporate double Debye theory to model the behavior of water subject to THz radiation. Furthermore, we apply this model to skin. (C) 2004 American Institute of Physics.