Telomerase is a ribonucleoprotein reverse transcriptase responsible for the maintenance of one strand of the telomere terminal repeats. It consists minimally of a catalytic protein component (TERT) and an RNA subunit that provides the template. Compared with prototypical reverse transcriptases, telomerase is unique in possessing a DNA binding domain (anchor site) that is distinct from the catalytic site. Yeast TERT mutants bearing deletion or point mutations in an N-terminal domain (known as N-GQ) were found to be selectively impaired in extending primers that form short hybrids with telomerase RNA. The mutants also suffered a significant loss of repeat addition processivity but displayed an enhancement in nucleotide addition processivity. Furthermore, the mutants manifested altered primer utilization properties for oligonucleotides containing non-telomeric residues in the 5-region. Crosslinking studies indicate that the N-GQ domain physically contacts the 5-region of the DNA substrate in the context of a telomerase-telomere complex. Together, these results implicate the N-GQ domain of TERT as a physical and functional constituent of the telomerase anchor site. Coupled with previous genetic analysis, our data confirm that anchor site interaction is indeed important for telomerase function in vivo.Telomerase is a ribonucleoprotein that is responsible for maintaining the terminal repeats of telomeres in most organisms (1). It acts as an unusual reverse transcriptase, using a small segment of an integral RNA component as template for the synthesis of the dG-rich strand of telomeres (2).The enzymatic core of telomerase consists minimally of two components, a reverse transcriptase (RT) 1 -like protein that catalyzes nucleotide addition (named TERT), and an RNA in which the template is embedded (for reviews see Refs. 3-6). Telomerase RNAs are evolutionarily divergent in sequence, but recent studies suggest that they share a number of key structural elements, including a template segment, a pseudoknot, and a long-range base-pairing element (for reviews, see Refs. 7 and 8). The TERT protein, on the other hand, is well conserved in evolution and possesses a central domain with significant sequence similarity to prototypical RTs (Fig. 1A) (9, 10). Flanking the RT domain are a large N-terminal extension and a short C-terminal extension (CTE). By analogy with prototypical RTs, the CTE is likely to constitute the so-called thumb domain of the polymerase (11,12). The N-terminal extension consists of a non-conserved region (named N-region), four conserved motifs (named GQ, CP, QFP, and T), and a flexible linker (located between the GQ and CP motif) (13, 14). The CP, QFP, and T motifs have been shown to mediate interaction with telomerase RNA (15-18). The N-region and GQ motif together apparently comprise a stable domain (named N-GQ) that is required for telomerase function both in vitro and in vivo (see below).An unusual property of telomerase is its ability to mediate realignment of the DNA product relative to the RNA templat...