Although telomeres are heterochromatic, they are transcribed into noncoding telomeric repeat-containing RNA (TERRA). Here we show that RNA-DNA hybrids form at telomeres and are removed by RNase H enzymes in the budding yeast, Saccharomyces cerevisiae. In recombination-competent telomerase mutants, telomeric RNA-DNA hybrids promote recombination-mediated elongation events that delay the onset of cellular senescence. Reduction of TERRA and telomeric RNA-DNA-hybrid levels diminishes rates of recombination-mediated telomere elongation in cis. Overexpression of RNase H decreases telomere recombination rates and accelerates senescence in recombination-competent but not recombination-deficient cells. In contrast, in the absence of both telomerase and homologous recombination, accumulation of telomeric RNA-DNA hybrids leads to telomere loss and accelerated rates of cellular senescence. Therefore, the regulation of TERRA transcription and telomeric RNA-DNA-hybrid formation are important determinants of both telomere-length dynamics and proliferative potential after the inactivation of telomerase.

Maintenance of a minimal telomere length is essential to prevent cellular senescence. When critically short telomeres arise in the absence of telomerase, they can be repaired by homology-directed repair (HDR) to prevent premature senescence onset. It is unclear why specifically the shortest telomeres are targeted for HDR. We demonstrate that the non-coding RNA TERRA accumulates as HDR-promoting RNA-DNA hybrids (R-loops) preferentially at very short telomeres. The increased level of TERRA and R-loops, exclusively at short telomeres, is due to a local defect in RNA degradation by the Rat1 and RNase H2 nucleases, respectively. Consequently, the coordination of TERRA degradation with telomere replication is altered at shortened telomeres. R-loop persistence at short telomeres contributes to activation of the DNA damage response (DDR) and promotes recruitment of the Rad51 recombinase. Thus, the telomere length-dependent regulation of TERRA and TERRA R-loops is a critical determinant of the rate of replicative senescence.

Telomeres are transcribed into non-coding TElomeric Repeat containing RNAs (TERRA). We have employed a transcriptionally inducible telomere to investigate how telomere transcription affects telomere function in Saccharomyces cerevisiae. We report that telomere shortening resulting from high levels of telomere transcription stems from a DNA replication-dependent loss of telomere tracts, which can occur independent of both telomerase inhibition and homologous recombination. We show that in order for telomere loss to occur, transcription must pass through the telomere tract itself producing a TERRA molecule. We demonstrate that increased telomere transcription of a single telomere leads to a premature cellular senescence in the absence of a telomere maintenance mechanism (telomerase and homology directed repair). Similar rapid senescence and telomere shortening are also seen in sir2Δ cells with compromised telomere maintenance, where TERRA levels are increased at natural telomeres. These data suggest that telomere transcription must be tightly controlled to prevent telomere loss and early onset senescence.