The maintenance of genome integrity through generations is largely determined by the stability of telomeres. Increasing evidence suggests that telomere dysfunction may trigger changes in cell fate, independently of telomere length. Telomeric multiple tandem repeats are potentially highly recombinogenic. Heterochromatin formation, transcriptional repression, the suppression of homologous recombination and chromosome end protection are all required for telomere stability. Genetic and epigenetic defects affecting telomere homeostasis may cause length-independent internal telomeric DNA damage. Growing evidence, including that based on Drosophila research, points to a telomere checkpoint mechanism that coordinates cell fate with telomere state. According to this scenario, telomeres, irrespective of their length, serve as a primary sensor of genome instability that is capable of triggering cell death or developmental arrest. Telomeric factors released from shortened or dysfunctional telomeres are thought to mediate these processes. Here, we discuss a novel signaling role for telomeric RNAs in cell fate and early development. Telomere checkpoint ensures genome stability in multicellular organisms but aggravates the aging process, promoting the accumulation of damaged and senescent cells.