A role for the telomerase reverse transcriptase subunit (Tert) in tumorigenesis independent of telomere length is emerging. K5‐Tert mice, which overexpress Tert in the skin, show increased tumorigenesis and faster wound healing than wild‐type controls. Here, we demonstrate that the telomerase RNA component Terc is necessary to mediate these effects of Tert overexpression. In contrast to K5‐Tert mice, K5‐Tert mice in a Terc‐deficient background, K5‐Tert/Terc^−/−, do not show increased tumorigenesis or increased wound healing compared with wild‐type controls. Indeed, K5‐Tert/Terc^−/− mice show a reduction in tumour growth compared with Terc^−/− controls, indicating an inhibitory effect of Tert overexpression in the absence of Terc. These results indicate that the tumour‐promoting effects of Tert overexpression require the formation of Tert–Terc complexes. In addition, we show that the increased expression of Tert in the absence of Terc has an inhibitory effect on tumorigenesis, independently of telomere length and telomerase activity. These findings highlight Terc as a target for telomerase‐based anticancer therapies.