Telomerase expression is the hallmark of tumor cells in which this ribonucleoprotein complex preserves chromosome integrity by maintaining telomere length and thereby prevents cell death. However, recent data support a role of the combination of p53 and telomerase inactivation in initiating genetic instability that promotes malignant transformation. Through its pleiotropic effects on infected T-cell metabolism, the human T-cell leukemia virus type 1 (HTLV-1) oncoprotein Tax plays a central role in leukemogenesis. Here, we show that Tax inhibits human telomerase reverse transcriptase (hTERT) transcription, which is the rate-limiting factor of telomerase activity. This inhibitory effect, that occurs in competition with c-Myc through a canonical c-Myc binding site within the hTERT promoter, results in a decreased telomerase activity of Tax-expressing cells. This is the first demonstration of hTERT inhibition by an oncogene. Tax, which is only expressed in preleukemic cells, triggers infected T-cell cycle and keeps these cells cycling while inactivating p53. We propose that, in combination with these effects, hTERT repression by Tax at an early phase of carcinogenesis might contribute to the massive ploidy changes associated with the development of HTLV-1-associated malignancies.