Objects We aimed to assess whether awareness of a terminal illness can affect care decision making processes and the achievement of a good death in advanced cancer patients receiving palliative care services. Methods Awareness of terminal illness at the time of palliative care service admission was assessed by the health care professionals during the routine initial comprehensive assessment process and was recorded in the national terminal cancer patient registry. A follow‐up nationwide bereavement survey was conducted, which contained questions regarding decision making processes and the Korean version of the Good Death Inventory. Results Among the 345 patients included in the final analysis, the majority (68.4%) of the patients were aware of the terminal illness. Awareness of the terminal illness tended to reduce discordances in care decision making (adjusted odds ratio = 0.55; 95% CI: 0.29–1.07), and increased the patients' own decision making when there were discordances between patients and their families (adjusted odds ratio = 3.79; 95% CI: 1.31–10.94). The Good Death Inventory score was significantly higher among patients who were aware of their terminal illnesses compared with those who were not (5.04 vs. 4.80; p = 0.013) and especially in the domains of ‘control over the future’ (5.18 vs. 4.04; p < 0.001), ‘maintaining hope and pleasure’ (4.55 vs. 3.92; p = 0.002), and ‘unawareness of death’ (4.41 vs. 4.26; p = 0.024). Conclusion Awareness of the terminal illness had beneficial effect on the harmonious decision making, patient autonomy, and patient's quality of death. Disclosure of terminal illness should be encouraged. Copyright © 2013 John Wiley & Sons, Ltd.