Telomere biology disorders (TBDs), caused by pathogenic germ line variants in telomere-related genes, present with multiorgan disease and a predisposition to cancer. Clonal hematopoiesis (CH) as a marker of cancer development and survival in TBDs is poorly understood. Here, we characterized the clonal landscape of a large cohort of 207 patients with TBD with a broad range of age and phenotype. CH occurred predominantly in symptomatic patients and in signature genes typically associated with cancers: PPM1D, POT1, TERT promoter (TERTp), U2AF1S34, and/or TP53. Chromosome 1q gain (Chr1q+) was the commonest karyotypic abnormality. Clinically, multiorgan involvement and CH in TERTp, TP53, and splicing factor genes were associated with poorer overall survival. Chr1q+ and splicing factor or TP53 mutations significantly increased the risk of hematologic malignancies, regardless of clonal burden. Chr1q+ and U2AF1S34 mutated clones were premalignant events associated with the secondary acquisition of mutations in genes related to hematologic malignancies. Similar to the known effects of Chr1q+ and TP53-CH, functional studies demonstrated that U2AF1S34 mutations primarily compensated for aberrant upregulation of TP53 and interferon pathways in telomere-dysfunctional hematopoietic stem cells, highlighting the TP53 pathway as a canonical route of malignancy in TBD. In contrast, somatic POT1/PPM1D/TERTp mutations had distinct trajectories unrelated to cancer development. With implications beyond TBD, our data show that telomere dysfunction is a strong selective pressure for CH. In TBD, CH is a poor prognostic marker associated with worse overall survival. The identification of key regulatory pathways that drive clonal transformation in TBD allows for the identification of patients at a higher risk of cancer development.