Telomeres protect DNA ends of linear eukaryotic chromosomes from degradation and fusion, and ensure complete replication of the terminal DNA through recruitment of telomerase. The regulation of telomerase is a critical area of telomere research and includes cis regulation by the shelterin complex in mammals and fission yeast. We have identified a key component of this regulatory pathway as the SUMOylation [the covalent attachment of a small ubiquitin-like modifier (SUMO) to target proteins] of a shelterin subunit in fission yeast. SUMOylation is known to be involved in the negative regulation of telomere extension by telomerase; however, how SUMOylation limits the action of telomerase was unknown until now. We show that SUMOylation of the shelterin subunit TPP1 homolog in Schizosaccharomyces pombe (Tpz1) on lysine 242 is important for telomere length homeostasis. Furthermore, we establish that Tpz1 SUMOylation prevents telomerase accumulation at telomeres by promoting recruitment of Stn1-Ten1 to telomeres. Our findings provide major mechanistic insights into how the SUMOylation pathway collaborates with shelterin and Stn1-Ten1 complexes to regulate telomere length.