Active telomerase is essential for stem cells and most cancers to maintain telomeres. The enzymatic activity of telomerase is related but not equivalent to the expression of TERT, the catalytic subunit of the complex. Here we show that telomerase enzymatic activity can be robustly estimated from the expression of a 13-gene signature. We demonstrate the validity of the expression-based approach, named EXTEND, using cell lines, cancer samples, and non-neoplastic samples. When applied to over 9,000 tumors and single cells, we find a strong correlation between telomerase activity and cancer stemness. This correlation is largely driven by a small population of proliferating cancer cells that exhibits both high telomerase activity and cancer stemness. This study establishes a computational framework for quantifying telomerase enzymatic activity and provides new insights into the relationships among telomerase, cancer proliferation, and stemness.