A radar system and a terminal device are provided. The radar system includes a controller and at least two radar modules directly or indirectly connected to the controller. The at least two radar modules include a first radar module and a second radar module, and the first radar module and the second radar module implement time division multiplexing of the controller in a digital domain. Compared with an existing radar system, the radar system in this application can provide more transmit channels, more receive channels, and a larger antenna array size when the two radar systems include a same quantity of controllers.