Telomeres play an important role in chromosome organization and stability. Human telomerase is a terminal transferase that adds TTAGGG units onto the telomere end. In general, telomerase activity is not detected in normal somatic cells but is present in immortalized cells. Consequently, telomerase might be a selective target for cancer chemotherapy. Using cell-free biochemical telomerase assay, we have found that 7-deaza-2'-deoxyguanosine-5'-triphosphate (7-deaza-dGTP) and 7-deaza-2'-deoxyadenosine-5'-triphosphate (7-deaza-dATP) were potent telomerase inhibitors. The concentrations of inhibitors in which 50% of the telomerase activity was inhibited (IC50 values) were 11 and 8 microM for 7-deaza-dGTP and 7-deaza-dATP, respectively. Additional studies show that both 7-deaza-dGTP and 7-deaza-dATP were also incorporated into telomeric DNA by telomerase. However, incorporation of 7-deaza-dATP or 7-deaza-dGTP results in a telomeric ladder that is prematurely shortened. No difference in the number or position of pause sites were observed when 7-deaza-dATP was compared to dATP as substrates. On the other hand, both a shift and an increase in pause sites was observed when dGTP was replaced by 7-deaza-dGTP. Incorporation of 7-deaza nucleotides by telomerase may be used as a tool for the study of telomerase mechanism and function. In addition, this may be a novel approach in the design of new telomerase inhibitors.