Replicative erosion of telomeres is naturally compensated by telomerase and studies in yeast and vertebrates show that homologous recombination can compensate for the absence of telomerase. We show that RAD51 protein, which catalyzes the key strand-invasion step of homologous recombination, is localized at Arabidopsis telomeres in absence of telomerase. Blocking the strand-transfer activity of the RAD51 in telomerase mutant plants results in a strikingly earlier onset of developmental defects, accompanied by increased numbers of end-to-end chromosome fusions. Imposing replication stress through knockout of RNaseH2 increases numbers of chromosome fusions and reduces the survival of these plants deficient for telomerase and homologous recombination. This finding suggests that RAD51-dependent homologous recombination acts as an essential backup to the telomerase for compensation of replicative telomere loss to ensure genome stability. Furthermore, we show that this positive role of RAD51 in telomere stability is dependent on the RTEL1 helicase. We propose that a RAD51 dependent break-induced replication process is activated in cells lacking telomerase activity, with RTEL1 responsible for D-loop dissolution after telomere replication.