The biology of telomeres and telomerase has been the subject of intensive investigative effort since it became evident that they play a significant role in two important biological processes, the loss of cellular replicative capacity inherent to organismal ageing and the unrestricted cell proliferation characteristic of carcinogenesis. Telomere shortening in normal cells is a result of DNA replication events, and reduction beyond a critical length is a signal for cellular senescence. One of the cellular mechanisms used to overcome proliferative restriction is the activation of the enzyme telomerase, which replaces the loss of telomeric DNA that occurs at each cell division. Studies have demonstrated that tumours have shorter telomeres than normal tissue and that telomerase is activated in up to 90% of all human cancers while it is present only in a limited range of normal adult tissues. The role of telomerase in the extension of the cellular replicative lifespan has recently been shown by ectopic expression of the enzyme, being consistent with the oncogenesis model whereby the acquisition of an 'immortal' phenotype is a requirement for advanced tumour progression. In this article we review the present knowledge of telomeres and telomerase in cancer and discuss the potential use of this enzyme as a diagnostic and prognostic tumour marker and as a target for cancer therapy.