We have cloned and characterized a human gene encoding TP2 (telomerase-associated protein 2), a protein with similarity to reverse transcriptases and the catalytic telomerase subunits from Saccharomyces cerevisiae and Euplotes aediculatus. Indirect immunofluorescence revealed that TP2 was localized to the nucleus. Using antibodies to endogenous and epitope-tagged TP2, we found that TP2 was associated specifically with human telomerase activity and the recently identified telomerase-associated protein TP1. Mutation of conserved residues within the reverse transcriptase domain of TP2 severely reduced associated telomerase activity. These results suggest that telomerase is an evolutionarily conserved multisubunit complex composed of both structural and catalytic subunits.