I couldn't figure out how to do this online but eventually figured it out myself. I figured I'd share this around since I saw so many people struggling with the same issue. My friends and I use the gaming PC in our bedroom to play emulated games on a TV with our controllers, and one of us wanted to play Terraria at the same time (specifically modded with tmodloader) but the controllers would override steam's own controller translation settings even when they were disabled because Terraria has native support for controllers now.

To disable controller input I navigated to the config.json file in the Documents/My Games/Terraria directory (if you use tModLoader there will be a copy of this config.json file in the folder by the same name here)

so

C:\Users\USERNAME\Documents\My Games\Terraria\config.json

or

C:\Users\USERNAME\Documents\My Games\Terraria\tModLoader\config.json

Right click this file and edit with notepad.

Use the "find" function in the edit tools (or press Ctrl+F)

Now search for these terms and flip them false to true or vice versa.

"AllowUnfocusedInputOnGamepad": false,
"InvisibleCursorForGamepad": false,
"GamepadDisableInstructionsDisplay": false,
"SettingBlockGamepadsEntirely": true,

this is how each of them should look before you save the config file. Don't forget to save it!

It would also be good to go into Steam's settings for both Terraria and tmodloader to make sure controller support is disabled, in case it tries to translate controller inputs into keyboard inputs.

I hope this helps you!