Telomeres are the composite of short DNA element tandem arrays and heterotypic protein components that protect and maintain chromosomal termini. As proper telomere maintenance requires a multitude of DNA extension events, it is important to understand the factors that modulate telomerase DNA association. Here, we show that the endogenous levels of the yeast p23 molecular chaperone Sba1p are required for telomere length maintenance and that Sba1p can modulate telomerase DNA binding and extension activities in vitro. Notably, telomere occupancy by telomerase and the extension rate of a shortened telomere fluctuated with changing Sba1 protein levels in vivo. In addition, we found that Sba1p displayed a cell cycle-dependent telomere interaction that paralleled telomerase binding; telomere association by Sba1p depended on its inherent chaperone activity. Taken together, our results support a model in which Sba1p modulates telomerase DNA binding activity for optimal function in vitro and in vivo. DNA protein dynamicsT elomerase maintains genomic integrity, in part, by preserving chromosome length after DNA replication (1-3). Because conventional DNA polymerases require priming events to initiate synthesis, the extreme terminus of each lagging strand cannot be completed, which is commonly referred to as the end replication problem (4). In the absence of a compensatory process, this limitation would lead to chromosome erosion with each round of DNA replication. However, almost all eukaryotes circumvent this problem by adding simple DNA sequence motifs to each terminus that buffers against the loss. Typically the DNA motifs are added by the specialized ribonucleoprotein complex telomerase that is composed of a reverse transcriptase protein and an associated template RNA; in yeast, EST2 and TLC1 encode these factors. Depending on the organism, telomerase increases chromosome ends between a few hundred to a few thousand nucleotides to create, in part, a telomere. Perhaps unexpectedly, it was realized that the length of each telomere is not added at once but rather telomerase may append 6-8 nt per binding event (5). Although it had been argued that telomerase activity might not need to be iterative to maintain telomere length, recent studies in yeast indicate that telomeres can be extended over 100 nt per cell cycle (6, 7). Unfortunately, yeast telomerase does not add multiple repeats in vitro but rather extends a DNA substrate a single repeat and remains bound in a stalled state (5). Thus, the question is raised about how a bound telomerase complex is removed to allow the redundant binding and addition cycles necessary to support proper telomere maintenance.Prior studies indicated that the p23 and Hsp90 molecular chaperones are required for reconstitution of human telomerase activity in vitro (8, 9); unlike other telomerase cofactors the molecular chaperones seemingly remain associated during reverse transcription (9). A recent study indicates that the Hsp90 interaction might be necessary to promote telomerase DNA binding ...