Telomerase is a ribonucleoprotein complex consisting of two essential core components: a reverse transcriptase and an RNA subunit (telomerase RNA [TR]). Dysregulation of telomerase has been associated with cell immortalization and oncogenesis. Marek's disease herpesvirus (MDV) induces a malignant T cell lymphoma in chickens and harbors in its genome two identical copies of a viral TR (vTR) with 88% sequence identity to chicken TR. MDV mutants lacking both copies of vTR were significantly impaired in their ability to induce T cell lymphomas, although lytic replication in vivo was unaffected. Tumor incidences were reduced by >60% in chickens infected with vTR- viruses compared with animals inoculated with MDV harboring at least one intact copy of vTR. Lymphomas in animals infected with the vTR- viruses were also significantly smaller in size and less disseminated. Constitutive expression of vTR in the chicken fibroblast cell line DF-1 resulted in a phenotype consistent with transformation as indicated by morphological alteration, enhanced anchorage-independent cell growth, cell growth beyond saturation density, and increased expression levels of integrin alpha v. We concluded that vTR plays a critical role in MDV-induced T cell lymphomagenesis. Furthermore, our results provide the first description of tumor-promoting effects of TR in a natural virus-host infection model.