Ataxia telangiectasia (AT) is characterized by neurological deterioration, immunodeficiency, spontaneous chromosomal instability, hypersensitivity to ionizing radiation, predisposition to cancer, particularly T cell leukaemia and lymphoma, and premature ageing. The most commonly observed defect affecting telomeres in humans is telomeric fusions, particularly in T lymphocytes in AT patients. Rarely, some tumour cells, like senescent cells, have dicentric chromosomes that may arise as a result of telomeric sequence loss. We show that the AT mutation in the homozygous state confers a predisposition to accelerated telomere shortening with increasing age in peripheral blood lymphocytes (PBLs), which may be linked to premature senescence. We also show that telomeric fusions are associated with large (> 90%) preleukaemic translocation clones in T cells. We propose that these fusions may result from a compound effect of accelerated telomere shortening, together with a growth advantage of cells in large clones which leads to further telomere loss. Fusions are not observed in leukaemic cells in these patients. There is no evidence that either accelerated telomere loss per se or telomeric fusions are important in tumourigenesis. Telomerase is present in both normal and AT lymphocytes and so neither telomere shortening nor telomeric fusions can be explained by the absence of telomerase.