Telomerase, whose core components are a reverse transcriptase (TERT) and an integral RNA (TERC) maintains telomere ends. In somatic cells in the absence of telomerase telomeres get shorter leading to replicative cell senescence. In cancer cells abundant telomerase is present and cells do not senesce. Hence levels of telomerase may be crucial in regulating senescence and the transition to the neoplastic state. Heterozygous TERC mutations in man have been shown to underlie the rare inherited skin and bone marrow failure condition dyskeratosis congenita and a number of patients initially classified as idiopathic aplastic anemia have also been found to be mutated in one allele of the TERC gene. Families in which TERC mutations are segregating show disease anticipation, the severity of the disease increasing in successive generations due to decreasing telomere length. These data, along with biochemical analysis of mutated Terc and studies of Terc deficient mice show that in man and mouse haploinsufficiency for TERC leads to inability to correctly maintain telomeres, and highlights the importance of finely controlled telomerase levels in striking a balance between the processes of aging and cancer. Here we review several scenarios in which telomerase levels are disturbed, in human diseases or following genetic manipulation in mice.