A paramount role of telomeres is to prevent chromosome fusions. The fission yeast Taz1 protein regulates diverse telomere functions but is not essential for growth under stress-free conditions. Strikingly, however, taz1(-) cells exhibit lethal telomere fusions when subjected to nitrogen starvation, a treatment that induces an uncommitted G1 state. These fusions are formed by Ku-dependent nonhomologous end joining. Fusions also occur during normal growth in taz1(-) cells that lack rad22(+), a gene involved in homologous recombination. Our data suggest a model whereby taz1(-) telomeres are exposed to the prevailing mode of DNA repair, which is dictated by the cell cycle. Thus, Taz1 caps chromosome ends and provides the telomerespecific interaction that prevents Ku from treating telomeres as double-strand breaks.