The telomeric shelterin component TPP1 has critical functions in telomeric protein complex assembly and telomerase recruitment and regulation. Here we identify USP7 as a novel interacting protein of the oligonucleotide/oligosaccharide-binding fold of TPP1, which was previously known to recruit telomerase to telomeres. We identify amino acids in TPP1 and USP7 that are critical for their interaction and multiple lysines within TPP1 that are oligo-ubiquitinated and deubiquitinated by USP7. Mutational analysis indicated that human TPP1 does not require ubiquitination for telomere association in contrast to previous observations reported for mouse Tpp1. Ubiquitination of human TPP1 also had no detectable effects on known protein interactions of TPP1 with TIN2, POT1, the CTC1-STN1-TEN1 complex, and telomerase. However, the close proximity of USP7 and telomerase binding sites on TPP1 suggest possible cross-talks. In addition, we found that TPP1 is degraded in a proteasome-dependent manner. Prevention of TPP1 ubiquitination prolonged TPP1 half-life similar to 2-fold from 45 to 90 min, and remarkably, proteasome inhibition prompted complete stability of TPP1. This indicates that the proteasome destabilizes TPP1 through both direct and indirect pathways possibly involving TPP1-interacting proteins. Altogether, our work identifies novel regulatory circuits that contribute to TPP1 stability and function.