Dyskeratosis congenita (DC) is characterized by the triad of reticulate skin pigmentation, nail dystrophy and leukoplakia. Epidermal atrophy, hair growth defects, bone marrow failure and increased risk of cancer are also common in DC patients. DC is caused by mutations in genes encoding for telomerase complex factors. Although there is an association of epidermal abnormalities with DC, epidermal cells from DC donors have not been previously characterized. We have isolated skin keratinocytes from affected members of a family with an autosomal dominant form of DC that is caused by a mutation in the RNA component of telomerase, TERC. Here, we demonstrate that, similar to DC fibroblasts from these donors, DC keratinocytes have short telomeres and a short lifespan. DC keratinocytes also exhibited impaired colony forming efficiency (CFE) and migration capacity. Exogenous expression of the reverse transcriptase (RT) component of telomerase, TERT, activated telomerase levels to half that of TERT expressing normal cells and maintained telomeres at a short length with concomitant extension of lifespan. Unlike fibroblasts, transduction of human papillomavirus type 16 E6/E7 genes into DC keratinocytes activated telomerase to half that of E6/E7 expressing normal cells, and robust proliferation was observed. While expression of TERC has no measurable effect on telomerase in fibroblasts, expression of TERC in keratinocytes upregulated telomerase activity and, rarely, allowed rescue of proliferative defects. Our results point to important differences between DC fibroblasts and keratinocytes and show, for the first time, that expression of TERC can increase the lifespan of primary human epithelial cells.