The ribonucleoprotein complex telomerase, which was found to be active in germ line, immortal, and tumor cells, and in cells from continuously renewing normal tissues such as epidermis or bone marrow, is thought to be correlated with an indefinite life span. Therefore, it has been postulated that in the normal tissues, telomerase activity may be restricted to stem cells, the possible precursors of tumor cells. Here, we demonstrate that a 56% enriched population of epidermal stem cells exhibited less telomerase activity than the more actively proliferating transit amplifying cells, which are destined to differentiate after a finite number of cell divisions. Thus telomerase is not a stem cell marker. In human epidermis we found a heterogeneous expression of the telomerase RNA component (hTR) within the basal layer, with clusters of hTR-positive cells showing variable activities. Histone-3 expressing S-phase basal cells were distributed evenly, illustrating that hTR upregulation may not strictly be correlated with proliferation. We further show for human epidermal cells that differentiation-dependent downregulation of telomerase correlates with Ca⁺⁺-induced cell differentiation and that increasing the amount of Ca⁺⁺ but not Mg⁺⁺ or Zn⁺⁺ reduced telomerase activity in a dose-dependent manner in a cell-free system (differentiation-independent). Furthermore, addition of ethyleneglycol-bis(β-aminoethyl ether)-N,N,N′,N′-tetraacetic acid completely reversed this Ca⁺⁺-induced inhibition. These data indicate that Ca⁺⁺ is not only an important regulator of epidermal differentiation but also a key regulator of telomerase.