Telomerase plays a pivotal role in tumorigenesis by both telomere-dependent and telomere-independent activities, although the underlying mechanisms are not completely understood. Using single-sample gene set enrichment analysis (ssGSEA) across 9,264 tumour samples, we observe that expression of telomerase reverse transcriptase (TERT) is closely associated with immunosuppressive signatures. We demonstrate that TERT can activate a subclass of endogenous retroviruses (ERVs) independent of its telomerase activity to form double-stranded RNAs (dsRNAs), which are sensed by the RIG-1/MDA5-MAVS signalling pathway and trigger interferon signalling in cancer cells. Furthermore, we show that TERT-induced ERV/interferon signalling stimulates the expression of chemokines, including CXCL10, which induces the infiltration of suppressive T–cell populations with increased percentage of CD4+ and FOXP3+ cells. These data reveal an unanticipated role for telomerase as a transcriptional activator of ERVs and provide strong evidence that TERT-mediated ERV/interferon signalling contributes to immune suppression in tumours.