Telomerase, the enzyme that extends chromosomal DNA ends in most eukaryotes, contains essential RNA and protein subunits. We have been studying telomere replication in hypotrichous ciliates such as Euplotes aediculatus, which have numerous short macronuclear DNA molecules and therefore are highly enriched in telomeres and in telomerase. Cloning and sequencing genes for the RNA subunits from several ciliates revealed that telomerase RNAs with insignificant nucleotide sequence homology nevertheless form a common secondary structure. Affinity chromatography based on the sequence of the RNA subunit was used to purify the Euplotes telomerase as an active ribonucleoprotein enzyme. Two protein subunits, 123 kDa and 43 kDa, were identified. The finding of a yeast homologue to the 123 kDa subunit suggests that telomerase protein components may be much more highly conserved in evolution than the RNA subunits. The purified Euplotes telomerase has no activity with blunt-ended DNA primers, but instead requires a four to six nucleotide single-stranded 3' tail. This result supports a model for telomere replication in which other activities such as helicases or nucleases activate replicated DNA for extension by telomerase, a model that may be applicable to telomere replication in diverse eukaryotes.