Dyskerin is a nucleolar protein present in small nucleolar ribonucleoprotein particles that modify specific uridine residues of rRNA by converting them to pseudouridine. Dyskerin is also a component of the telomerase complex. Point mutations in the human gene encoding dyskerin cause the skin and bone marrow failure syndrome dyskeratosis congenita (DC). To test the extent to which disruption of pseudouridylation or telomerase activity may contribute to the pathogenesis of DC, we introduced two dyskerin mutations into murine embryonic stem cells. The A353V mutation is the most frequent mutation in patients with X-linked DC, whereas the G402E mutation was identified in a single family. The A353V, but not the G402E, mutation led to severe destabilization of telomerase RNA, a reduction in telomerase activity, and a significant continuous loss of telomere length with increasing numbers of cell divisions during in vitro culture. Both mutations caused a defect in overall pseudouridylation and a small but detectable decrease in the rate of pre-rRNA processing. In addition, both mutant embryonic stem cell lines showed a decrease in the accumulation of a subset of H/ACA small nucleolar RNAs, correlating with a significant decrease in site-specific pseudouridylation efficiency. Interestingly, the H/ACA snoRNAs decreased in the G402E mutant cell line differed from those affected in A353V mutant cells. Hence, our findings show that point mutations in dyskerin may affect both the telomerase and pseudouridylation pathways and the extent to which these functions are altered can vary for different mutations.