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Oxidative damage of telomeres can promote cancer, cardiac failure, and muscular dystrophy. Specific mechanisms protecting telomeres from oxidative damage have not been described. We analyzed telomeric chromatin composition during the cell cycle and show that the antioxidant enzyme peroxiredoxin 1 (PRDX1) is enriched at telomeres during S phase. Deletion of the PRDX1 gene leads to damage of telomeric DNA upon oxidative stress, revealing a protective function of PRDX1 against oxidative damage at telomeres. We also show that the oxidized nucleotide 8-oxo-2' deoxyguanosine-5'-triphosphate (8oxodGTP) causes premature chain termination when incorporated by telomerase and that some DNA substrates terminating in 8oxoG prevent extension by telomerase. Thus, PRDX1 safeguards telomeres from oxygen radicals to counteract telomere damage and preserve telomeric DNA for elongation by telomerase.