The pathogenesis of koala retrovirus (KoRV) has been explored in various contexts, yet its role in tumorigenesis remains incompletely understood. Unlike acute transforming retroviruses, KoRV lacks a viral oncogene but may contribute to oncogenesis via indirect mechanisms. However, the relationship between KoRV and telomere length, as a potential indicator of telomerase activity, has not been examined. This study investigates the effect of KoRV infection on telomere length in 47 samples from Southern Australian koalas in a novel telomere length quantification method. Telomere lengths of 30 KoRV-negative samples were compared to those of 17 KoRV-positive samples using the Absolute Human Telomere Length Quantification qPCR kit (ScienCell Research Laboratories, California, USA). The telomere length in KoRV-infected WBCs was significantly longer than the uninfected ones (t = −2.059, p-value = 0.045). In line with this, telomere length correlated positively with proviral load (r = 0.421, p-value = 0.003), further linking viral burden to telomere elongation. Furthermore, the effect of age on telomere length differed by infection status (β = −5329.7, p-value = 0.0038); KoRV-positive individuals exhibited longer telomeres at a younger age but experienced more rapid telomere attrition over time compared to KoRV-negative individuals. These results suggest KoRV promotes telomerase elongation ability and modulates age-related telomere dynamics, potentially contributing to subsequent cellular immortality and oncogenesis. These pathways may overlap with other retroviruses, where telomerase dysregulation contributes to their oncogenic potential. This study provides new insights into KoRV pathogenesis and DNA quantification methodology, which could be valuable for future research by identifying predictive markers for tumour progression and potential therapeutic targets in affected koalas.