The ends of eukaryotic chromosomes are capped by telomeres which consist of tandem G-rich DNA repeats stabilized by the shelterin protein complex. Telomeres shorten progressively in most normal cells due to the end replication problem. In more than 85% of cancers however, the telomere length is maintained by telomerase; a reverse transcriptase that adds telomeric TTAGGG repeats using its integral RNA template. The strong association between telomerase activity and malignancy in many cancers suggests that telomerase activity could serve as a diagnostic marker. We demonstrate single-molecule, real-time telomerase extension activity observed digitally as the telomeric repeats are added to a substrate. The human telomerase complex pulled down from mammalian cells displays extension activity dependent on dNTP concentration. In complex with the processivity factor, POT1-TPP1, telomerase adds repeats at an accelerated rate and yields longer products. Our assay provides a unique detection platform that enables the study of telomerase kinetics with single molecule resolution.