Most somatic cells do not express sufficient amounts of telomerase to maintain a constant telomere length during cycles of chromosome replication. Consequently, there is a limit to the number of doublings somatic cells can undergo before telomere shortening triggers an irreversible state of cellular senescence. Ectopic expression of telomerase overcomes this limitation, and in conjunction with specific oncogenes can transform cells to a tumorigenic phenotype. However, recent studies have questioned whether the stabilization of chromosome ends entirely explains the ability of telomerase to promote tumorigenesis and have resulted in the hypothesis that telomerase has a second function that also supports cell division. Here we show that ectopic expression of telomerase in human mammary epithelial cells (HMECs) results in a diminished requirement for exogenous mitogens and that this correlates with telomerase-dependent induction of genes that promote cell growth. Furthermore, we show that inhibiting expression of one of these genes, the epidermal growth factor receptor (EGFR), reverses the enhanced proliferation caused by telomerase. We conclude that telomerase may affect proliferation of epithelial cells not only by stabilizing telomeres, but also by affecting the expression of growth-promoting genes.