Background In humans telomerase is expressed in most cancers and immortal cell lines, and astivation of telomerase may play important roles in tumorigenesis and immortalization. This study was to investigate the roles of telomerase activity (TA) and human telomerase RNA (hTR) in sebaceous carcinoma of the eyelid. Methods The telomerase repeated amplification protocal ( TRAP) was used to demonstrate telomerase activity in 12 cases of sebaceous carcinoma of the eyelid. In situ hybridization (ISH) was used to demonstrate the expression of hTR in 55 cases of paraffin-embedded sebaceous carcinoma of the eyelid, and the results were compared with the proliferative index determined by Mib-1 immuno-labeling, histological patterns and recurrence of the tumor. Results Different telomerase activity was shown in the 12 cases of sebaceous carcinoma of the eyelid. The positive expression of hTR was 85.5% (47/55) in tumor cells, but not in the adjacent tissues. The positive expression of hTR was correlated with the proliferative activity (as assessed by Mib-1 immunolabelling, r = 0.942, P < 0.001) and the differentiation of sebaceous carcinoma of the eyelid (chi(2) = 17.621, P <0.001), but not significantly related to tumor recurrence. The level of hTR expression increased with the decrease of differentiation of sebaceous carcinoma of the eyelid. Conclusions The results suggest that the up-regulation of telomerase expression plays some roles in tarsal gland carcinogenesis, and the expression of hTR is a useful marker for malignant degree of sebaceous carcinoma of the eyelid.