This is a known issue in the latest version of Terraria for iOS. If you receive a call or press the power button to lock the screen while playing, Terraria will appear to be frozen when you return to it.  Don't worry, the game hasn't crashed!  Simply press the Home button to suspend your game and then resume it. You can resume by tapping on the Terraria icon or by double-clicking the Home button to see your recently used apps, swipe left or right to find Terraria, and then tap on it.

Terraria will pop back up with the pause menu displayed, which is the normal behavior from pressing the home button or suspending the game.  This will be fixed in a future update, and we apologize for the inconvenience and confusion this may cause.