In S. cerevisiae, mutations in genes that encode telomerase components, such as the genes EST1, EST2, EST3, and TLC1, result in the loss of telomerase activity in vivo. Two telomerase-independent mechanisms can overcome the resulting senescence. Type I survival is characterized by amplification of the subtelomeric Y' elements with a short telomere repeat tract at the terminus. Type II survivors arise through the abrupt addition of long tracts of telomere repeats. Both mechanisms are dependent on RAD52 and on either RAD50 or RAD51. We show here that the telomere elongation pathway in yeast (type II) is dependent on SGS1, the yeast homolog of the gene products of Werner's (WRN) and Bloom's (BLM) syndromes. Survival in the absence of SGS1 and EST2 is dependent upon RAD52 and RAD51 but not RAD50. We propose that the RecQ family helicases are required for processing a DNA structure specific to eroding telomeres.