Most human tumor cells acquire immortality by activating the expression of telomerase, a ribonucleoprotein that maintains stable telomere lengths at chromosome ends throughout cell divisions. Other tumors use an alternative mechanism of telomere lengthening (ALT), characterized by high frequencies of telomeric sister chromatid exchanges (T-SCEs). Mechanisms of ALT activation are still poorly understood, but recent studies suggest that DNA hypomethylation of chromosome ends might contribute to the process by facilitating T-SCEs. Here, we show that ALT/T-SCE(high) tumor cells display low DNA-methylation levels at the D4Z4 and DNF92 subtelomeric sequences. Surprisingly, however, the same sequences retained high methylation levels in ALT/T-SCE(high) SV40-immortalized fibroblasts. Moreover, T-SCE rates were efficiently reduced by ectopic expression of active telomerase in ALT tumor cells, even though subtelomeric sequences remained hypomethylated. We also show that hypomethylation of subtelomeric sequences in ALT tumor cells is correlated with genome-wide hypomethylation of Alu repeats and pericentromeric Sat2 DNA sequences. Overall, this study suggests that, although subtelomeric DNA hypomethylation is often coincident with the ALT process in human tumor cells, it is not required for T-SCE.