The steepness of the slope often dictates wall height. Make the terraces in your yard high enough so the land between them is fairly level. Be sure the terrace material is strong enough and anchored well enough to stay in place through freezing and thawing, and heavy rainstorms. Do not underestimate the pressure of water-logged soil behind a wall. It can be enormous and cause improperly constructed walls to bulge or collapse.
Many communities have building codes for walls and terraces.
Large projects will need the expertise of a professional to make sure the walls can stand up to water pressure in the soil. Large terraces also need to be built with proper drainage and to be tied back into the slope properly. Because of the expertise and equipment required to do this correctly, you will probably want to restrict terraces you build yourself to no more than a foot or two high. The safest way to build a terrace is probably the cut and fill method. With this method, little soil is disturbed, giving you protection from erosion should a sudden storm occur while the work is in progress.