Telomeric repeat containing RNA (TERRA) is transcribed from subtelomeric regions to telomeres. TERRA RNA can invade telomeric dsDNA and form telomeric R-loop structures. A growing body of evidence suggests that TERRA-mediated R-loops are critical players in telomere length homeostasis. Here, we will review current knowledge on the regulation of R-loop levels at telomeres. In particular, we will discuss how the central player TERRA and its binding proteins modulate R-loop levels through various mechanisms. We will further provide an overview of the consequences of TERRA-mediated persistent or unscheduled R-loops at telomeres in human ALT cancers and other organisms, with a focus on telomere length regulation after replication interference-induced damage and DNA homologous recombination-mediated repair.