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Telomere maintenance and tumor cell differentiation have been separately implicated in neuroblastoma malignancy. Their mechanistic connection is unclear. We analyzed neuroblastoma cell lines and morphologic subclones representing the adrenergic (ADRN) and mesenchymal (MES) differentiation states and uncovered sharp differences in their telomere protein and telomerase activity levels. Pharmacologic conversion of ADRN into MES cells elicited consistent and robust changes in the expression of telomere-related proteins. Conversely, stringent down-regulation of telomerase activity triggers the differentiation of ADRN into MES cells, which was reversible upon telomerase upregulation. Interestingly, the MES differentiation state is associated with elevated levels of innate immunity factors, including key components of the DNA-sensing pathway. Accordingly, MES but not ADRN cells can mount a robust response to viral infections in vitro. A gene expression signature based on telomere and cell lineage-related factors can cluster neuroblastoma tumor samples into predominantly ADRN or MES-like groups, with distinct clinical outcomes. Our findings establish a novel mechanistic connection between telomere and differentiation and suggest that manipulating telomeres may suppress malignancy not only by limiting the tumor growth potential but also by inducing tumor cell differentiation and altering its immunogenicity.