Go to the View menu and turn on Hidden Geometry. Then you’ll be able to select part of the terrain.
Don’t forget that the location may be locked, if it looks frame with red lines. Right-click to unlock it. Then you’ll need to select Edit Group to get at the actual terrain faces.
Create a face directly above the terrain, equivalent to the area of the terrain you wish to define.
Use the Sandbox - Drape Tool to drape the edges upon the surface of the terrain.