The skin human papillomavirus (HPV) types belonging to the genus beta of the HPV phylogenetic tree appear to be associated with nonmelanoma skin cancer. We previously showed that the beta HPV type 38 E6 and E7 oncoproteins are able to inactivate the tumor suppressors p53 and retinoblastoma. Here, both viral proteins were expressed in primary human skin keratinocytes in order to study their effects on the telomere/telomerase system. We show that immortalization of skin keratinocytes induced by HPV38 E6/E7 is associated with hTERT gene overexpression. This event is, in part, explained by the accumulation of the p53-related protein, DeltaNp73. Despite elevated levels of hTERT mRNA, the telomerase activity detected in HPV38 E6/E7 keratinocytes was lower than that observed in HPV16 E6/E7 keratinocytes. The low telomerase activation in highly proliferative HPV38 E6/E7 keratinocytes resulted in the presence of extremely short and unstable telomeres. In addition, we observed anaphase bridges, mitotic multipolarity, and dramatic genomic aberrations. Interestingly, the ectopic expression of hTERT prevents both telomere erosion and genomic instability. Thus, we showed that in HPV38 E6/E7 keratinocytes characterized by unscheduled proliferation, suboptimal activation of telomerase and subsequent extensive telomere shortening result in genomic instability facilitating cellular immortalization.