Rap1p localization factor 4 (RLF4) is a Saccharomyces cerevisiae gene that was identified in a screen for mutants that affect telomere function and alter the localization of the telomere binding protein Rap1p. In rlf4 mutants, telomeric silencing is reduced and telomere DNA tracts are shorter, indicating that RLF4 is required for both the establishment and/or maintenance of telomeric chromatin and for the control of telomere length. In this paper, we demonstrate that RLF4 is allelic to NMD2/UPF2, a gene required for the nonsense-mediated mRNA decay (NMD) pathway (Y. Cui, K. W. Hagan, S. Zhang, and S. W. Peltz, Mol. Cell. Biol. 9:423-436, 1995, and F. He and A. Jacobson, Genes Der. 9:437-454, 1995). The NMD pathway, which requires Nmd2p/Rlf4p together with two other proteins, (Upf1p and Upf3p), targets nonsense messages for degradation in the cytoplasm by the exoribonuclease Xrn1p. Deletion of UPF1 and UPF3 caused telomere-associated defects like those caused by rlf4 mutations, implying that the NMD pathway, rather than an NMD-independent function of Nmd2p/Rlf4p, is required for telomere functions. In addition, telomere length regulation required Xrn1p but not Rat1p, a nuclear exoribonuclease with functional similarity to Xrn1p (A. W. Johnson, Mol. Cell. Biol. 17:6122-6130, 1997). In contrast, telomere-associated defects were not observed in pan2, pan3, or pan2 pan3 strains, which are defective in the intrinsic deadenylation-dependent decay of normal (as opposed to nonsense) mRNAs. Thus, loss of the NMD pathway specifically causes defects at telomeres, demonstrating a physiological requirement for the NMD pathway in normal cell functions. We propose a model in which the NMD pathway regulates the levels of specific mRNAs that are important for telomere functions.