Telomerase is a ribonucleoprotein enzyme essential for the replication of chromosome termini in most eukaryotes. Telomerase RNA components have been identified from many organisms, but no protein component has been demonstrated to catalyze telomeric DNA extension. Telomerase was purified from Euplotes aediculatus, a ciliated protozoan, and one of its proteins was partially sequenced by nanoelectrospray tandem mass spectrometry. Cloning and sequence analysis of the corresponding gene revealed that this 123-kilodalton protein (p123) contains reverse transcriptase motifs. A yeast (Saccharomyces cerevisiae) homolog was found and subsequently identified as EST2 (ever shorter telomeres), deletion of which had independently been shown to produce telomere defects. Introduction of single amino acid substitutions within the reverse transcriptase motifs of Est2 protein led to telomere shortening and senescence in yeast, indicating that these motifs are important for catalysis of telomere elongation in vivo. In vitro telomeric DNA extension occurred with extracts from wild-type yeast but not from est2 mutants or mutants deficient in telomerase RNA. Thus, the reverse transcriptase protein fold, previously known to be involved in retroviral replication and retrotransposition, is essential for normal chromosome telomere replication in diverse eukaryotes.