Woc is a Drosophila zinc finger protein that shares homology with the human polypeptides ZNF261 and ZNF198 implicated in mental retardation and leukemia syndromes. We show that mutations in the woc gene cause frequent telomeric fusions in Drosophila brain cells. Woc localizes to all telomeres and most interbands of polytene chromosomes. In interbands, Woc precisely colocalizes with the initiating forms of RNA polymerase II (Pol II). To characterize the role of woc in telomere maintenance, we analyzed its relationships with Su(var)205, cav, atm, and rad50, four genes that prevent telomeric fusions; Su(var)205 and cav encode HP1 and HP1/ORC Associated Protein (HOAP), respectively. woc mutants displayed normal telomeric accumulations of both HP1 and HOAP, and mutations in cav, Su(var)205, atm, and rad50 did not affect Woc localization on polytene chromosome telomeres. Collectively, our results indicate that Woc is a transcription factor with a telomere-capping function independent of those of Su(var)205, cav, atm, and rad50.