BACKGROUND: Telomeric repeat-containing RNA (TERRA) is a large non-coding RNA in mammalian cells, which forms an integral component of telomeric heterochromatin. TERRA can bind to an allosteric site of telomeric repeat factor 2 (TRF2), a key component of Shelterin that protect chromosome termini. Both TERRA and TRF2 have been recognized as promising new therapeutic targets for cancer treatment. METHODS: Our methods include FRET assay, SPR, CD, microscale thermophoresis (MST), enzyme-linked immunosorbent assay (ELISA), chromatin immunoprecipitation (ChIP), colony formation assays, Western blot, immunofluorescence, cell cycle arrest and apoptosis detection, and xCELLigence real-time cell analysis (RTCA). RESULTS: In our routine screening of small molecule libraries, we found that a Quindoline derivative, CK1-14 could bind to and stabilize TERRA G-quadruplex structure, which could bind more tightly with an allosteric site of a telomeric binding protein TRF2, resulting in dissociation of TRF2 from telomeric DNA. Further in cellular studies indicated that the above effect of CK1-14 on TERRA G-quadruplex could activate DNA-damage response and cause cell cycle arrest, resulting in inhibition of U2OS cell proliferation and causing cell apoptosis. CONCLUSIONS: Our mechanistic studies indicated that interaction of CK1-14 with TERRA induces telomeric DNA-damage response in U2OS cancer cells through inhibition of TRF2. CK1-14 could be further developed as a promising lead compound targeting telomere for cancer treatment. GENERAL SIGNIFICANCE: Our present study provides the first evidence that allosteric modulation of TRF2 by TERRA G-quadruplex with a binding ligand could become a promising new strategy for cancer treatment especially for ALT tumor cells.