Genetic lesions that reduce telomerase activity inhibit stem cell replication and cause a range of incurable diseases, including dyskeratosis congenita (DC) and pulmonary fibrosis (PF). Modalities to restore telomerase in stem cells throughout the body remain unclear. Here, we describe small-molecule PAPD5 inhibitors that demonstrate telomere restoration in vitro, in stem cell models, and in vivo. PAPD5 is a non-canonical polymerase that oligoadenylates and destabilizes telomerase RNA component (TERC). We identified BCH001, a specific PAPD5 inhibitor that restored telomerase activity and telomere length in DC patient induced pluripotent stem cells. When human blood stem cells engineered to carry DC-causing PARN mutations were xenotransplanted into immunodeficient mice, oral treatment with a repurposed PAPD5 inhibitor, the dihydroquinolizinone RG7834, rescued TERC 3' end maturation and telomere length. These findings pave the way for developing systemic telomere therapeutics to counteract stem cell exhaustion in DC, PF, and possibly other aging-related diseases.