The layered sedimentary deposits in Terby Crater on Mars show evidence of being formed in a lake. The deposits are finely layered and dip to the northwest, indicating deposition from that direction into a lake. The elevation of deposits in Terby and surrounding craters align with proposed shorelines of a large paleolake in the Hellas impact basin, suggesting Terby was once part of this lake system. Over time, glacial erosion selectively dissected and sculpted the layered sediments, forming the ridges and basins seen today.