Armory has a built-in tool to generate terrains from greyscale heightmaps. It can be found at Properties > Scene Properties > Armory Terrain. This tool generates terrain sectors from heightmap images in a directory. To use the tool, place the heightmap for each sector of the terrain in the <Project Dir>/Bundled/<Terrain Heightmap Dir>. Each heightmap image must be named in this format heightmap_<sector number>.png.

For example, a terrain with 4 sectors should have images named heightmap_01.png, heightmap_02.png, heightmap_03.png and heightmap_04.png.

With the images in the directory, choose the number of terrain sectors in X and Y directions and click Generate

• Textures: Directory containing heightmap images.
• Sectors : Number of terrain grid sectors along X and Y
• Sector Size : Size of each sector in Blender Units
• Height Scale : Maximum terrain height in Blender Units
• Generate: Button to start terrain generation
• Object: Current terrain object

At runtime, the terrain sectors have Bullet Physics Height Field Terrain Shape added to them, so physics objects can interact with the terrain.

• https://github.com/armory3d/armory_examples/tree/master/mesh_terrain
• https://github.com/armory3d/armory_templates/tree/master/third_person_terrain