Telomerase activation through induction of telomerase reverse transcriptase (hTERT) contributes to malignant transformation by stabilizing telomeres. Clinical studies demonstrate that higher hTERT expression is associated with cancer progression and poor outcomes, but the underlying mechanism is unclear. Because epithelial-mesenchymal transition (EMT) and cancer stem cells (CSCs) are key factors in cancer metastasis and relapse, and hTERT has been shown to exhibit multiple biological activities independently of its telomere-lengthening function, we address a potential role of hTERT in EMT and CSCs using gastric cancer (GC) as a model. hTERT overexpression promotes, whereas its inhibition suppresses, EMT and stemness of GC cells, respectively. Transforming growth factor (TGF)-β1 and β-catenin-mediated EMT was abolished by small interfering RNA depletion of hTERT expression. hTERT interacts with β-catenin, enhances its nuclear localization and transcriptional activity, and occupies the β-catenin target vimentin promoter. All these hTERT effects were independent of its telomere-lengthening function or telomerase activity. hTERT and EMT marker expression correlates positively in GC samples. Mouse experiments demonstrate the in vivo stimulation of hTERT on cancer cell colonization. Collectively, hTERT stimulates EMT and induces stemness of cancer cells, thereby promoting cancer metastasis and recurrence. Thus, targeting hTERT may prevent cancer progression by inhibiting EMT and CSCs.