Telomeres, comprised of short repetitive sequences, are essential for genome stability and have been studied in relation to cellular senescence and aging. Telomerase, the enzyme that adds telomeric repeats to chromosome ends, is essential for maintaining the overall telomere length. A lack of telomerase activity in mammalian somatic cells results in progressive shortening of telomeres with each cellular replication event. Mammals exhibit high rates of cell proliferation during embryonic and juvenile stages but very little somatic cell proliferation occurs during adult and senescent stages. The telomere hypothesis of cellular aging states that telomeres serve as an internal mitotic clock and telomere length erosion leads to cellular senescence and eventual cell death. In this report, we have examined telomerase activity, processivity, and telomere length in Daphnia, an organism that grows continuously throughout its life. Similar to insects, Daphnia telomeric repeat sequence was determined to be TTAGG and telomerase products with five-nucleotide periodicity were generated in the telomerase activity assay. We investigated telomerase function and telomere lengths in two closely related ecotypes of Daphnia with divergent lifespans, short-lived D. pulex and long-lived D. pulicaria. Our results indicate that there is no age-dependent decline in telomere length, telomerase activity, or processivity in short-lived D. pulex. On the contrary, a significant age dependent decline in telomere length, telomerase activity and processivity is observed during life span in long-lived D. pulicaria. While providing the first report on characterization of Daphnia telomeres and telomerase activity, our results also indicate that mechanisms other than telomere shortening may be responsible for the strikingly short life span of D. pulex.