ABSTRACT: Human telomerase, hTERT, catalyzes telomere elongation using the hTR long noncoding RNA (lncRNA) template and confers replicative immortality, a hallmark of cancer. hTERT is reactivated in nearly 90% of cancers and telomere elongation was considered its sole role in tumorigenesis. However, evidence for telomere-independent hTERT cell phenotypes, which surprisingly require hTERT catalytic activity, is mounting. These phenotypes could profoundly impact our understanding and clinical exploitation of hTERT’s role in cancer, but their underlying mechanisms remain unclear. One mechanism was suggested by the demonstration of hTERT’s ability to bind an alternative lncRNA, RMRP, and synthesize double-stranded RNAs that are processed into Argonaute2-bound small interfering RNAs that suppress the lncRNA itself. Here we performed systematic lncRNA profiling to determine whether this is a general mode of hTERT action involving novel lncRNAs, and investigated the implications of hTERT-mediated lncRNA suppression for tumorigenesis. We found that hTERT’s telomere-independent catalytic activity increased cell survival resulting in luminal hyperplasia in a human breast acinar morphogenesis model. Using next-generation sequencing of Argonaute2-associated small RNAs, we discovered novel hTERT-downregulated lncRNAs. One such lncRNA, MEG3, could bind hTERT and was significantly downregulated in human breast carcinoma cell lines and tissues. MEG3 knockdown promoted survival and hyperplasia, consistent with early tumorigenesis, and ectopic MEG3 expression caused cell death and inhibited breast cancer cell proliferation. Microarray analysis identified Bcl2-interacting proteins, BEX1 and BNIPL, as MEG3 targets. BEX1 mediates cell death by decreasing phospho-Bcl2, and MEG3 or hTERT modulated phospho-Bcl2 levels. This pathway could, in part, underlie the observed phenotypes. Collectively, our findings show that hTERT can suppress multiple lncRNAs, including MEG3, and establish a novel mechanism of hTERT-mediated proliferative control that could facilitate tumorigenesis. Our mechanistic insights suggest that small RNA-directed diagnostic and therapeutic strategies will be relevant for targeting hTERT.