We report that mouse liver cells are highly resistant to extensive telomere dysfunction. In proliferating cells, telomere dysfunction results in chromosome end fusions, a DNA damage signal, and apoptosis or senescence. To determine the consequences of telomere dysfunction in noncycling cells, we used conditional deletion of the telomeric protein TRF2 in hepatocytes. TRF2 loss resulted in telomeric accumulation of γ-H2AX and frequent telomere fusions, indicating telomere deprotection. However, there was no induction of p53 or apoptosis, and liver function appeared unaffected. Furthermore, the loss of TRF2 did not compromise liver regeneration after partial hepatectomy. Remarkably, liver regeneration occurred without cell division involving endoreduplication and cell growth, thereby circumventing the chromosome segregation problems associated with telomere fusions. We conclude that nondividing hepatocytes can maintain and regenerate liver function despite substantial loss of telomere integrity.