A study was undertaken to correlate telomere dysfunction and genomic instability with the histopathological grades and the estrogen and progesterone receptor status in breast cancer. Sixty‐one archived breast tissues (38 cancer tissues and 23 paired normal tissues) were used in the study. The breast tumor tissues showed significantly shorter telomeres (7.7 kb) compared with the paired adjacent tissues (9.0 kb) by Southern blot analysis. Moreover, telomere shortening was more significant in Grade III tumors than in the Grade II tumors (P = 0.05). Quantitative fluorescence in situ hybridization on paraffin tissue sections revealed a similar trend in telomere shortening. Telomere attrition was associated with telomere dysfunction as revealed by the presence of significantly higher anaphase bridges in tumor cells which was tumor grade dependent. Furthermore, estrogen receptive negative tumors displayed higher anaphase and internuclear bridges. Selected samples from each grade showed greater genomic imbalances in the higher grades than the lower grade tumors as detected by array‐comparative genomic hybridization. Telomerase activity was found to be higher in the higher grades (Grade II and III) compared with the lower grade (Grade I). The average mRNA expression of TRF1 and POT1 was lower in the tumor tissues than in the normal tissues. Tankyrase 1 mRNA expression showed a grade‐dependent increase in tumor tissues and its expression was also high in estrogen and progesterone negative tumors. The data support the notion that telomere dysfunction might be of value as a marker of aggressiveness of the tumors in breast cancer patients. © 2008 Wiley‐Liss, Inc.