hTERT, which encodes the catalytic subunit of telomerase and is expressed in most immortalized and cancer cells, has been reported to have increased DNA methylation in its promoter region in many cancers. This pattern is inconsistent with observations that DNA methylation of promoter CpG islands is typically associated with gene silencing. Here, we provide a comprehensive analysis of promoter DNA methylation, chromatin patterns, and expression of hTERT in cancer and immortalized cells. Methylation-specific PCR and bisulfite sequencing of the hTERT promoter in breast, lung, and colon cancer cells show that all cancer cell lines retain alleles with little or no methylation around the transcription start site despite being densely methylated in a region 600 bp upstream of the transcription start site. By real-time reverse transcription-PCR, all cancer cell lines express hTERT. Chromatin immunoprecipitation (ChIP) analysis reveals that both active (acetyl-H3K9 and dimethyl-H3K4) and inactive (trimethyl-H3K9 and trimethyl-H3K27) chromatin marks are present across the hTERT promoter. However, using a novel approach combining methylation analysis of ChIP DNA, we show that active chromatin marks are associated with unmethylated DNA, whereas inactive marks of chromatin are associated with methylated DNA in the region around the transcription start site. These results show that DNA methylation patterns of the hTERT promoter (−150 to +150 around the transcription start) are consistent with the usual dynamics of gene expression in that the absence of methylation in this region and the association with active chromatin marks allow for the continued expression of hTERT. [Cancer Res 2007;67(1):194–201]