The strand of telomeric DNA that runs 5'-3' toward a chromosome end is typically G rich. Telomerase-generated G tails are expected at one end of individual DNA molecules. Saccharomyces telomeres acquire TG1-3 tails late in S phase. Moreover, the telomeres of linear plasmids can interact when the TG1-3 tails are present. Molecules that mimic the structures predicted for telomere replication intermediates were generated in vitro. These in vitro generated molecules formed telomere-telomere interactions similar to those on molecules isolated from yeast, but only if both ends that interacted had a TG1-3 tail. Moreover, TG1-3 tails were generated in vivo in cells lacking telomerase. These data suggest a new step in telomere maintenance, cell cycle-regulated degradation of the C1-3A strand, which can generate a potential substrate for telomerase and telomere-binding proteins at every telomere.