Telomerase replicates chromosome ends in germ and somatic stem cells to facilitate their continued proliferation. Telomerase action depends on the telomeric protein TPP1, which recruits telomerase to telomeres and facilitates processive DNA synthesis. Here, we identify separation-of-function long (TPP1-L) and short (TPP1-S) isoforms of TPP1 that appear to be generated from separate transcripts and differ only in 86 amino acids at their N terminus. Although both isoforms retain the ability to recruit telomerase, only TPP1-S facilitates efficient telomere synthesis. We find that TPP1-S is the predominant isoform in somatic cells, and strikingly, TPP1-L is the major isoform in differentiated male germ cells. We observed that TERT expression persists in these germ cells, suggesting that TPP1-L could restrain telomerase in this context. We show how differential expression of TPP1 isoforms determines telomerase function and demonstrate how alternative transcription start sites allow one gene to perform distinct functions in different biological contexts.