Linear replicons can be found in a minority of prokaryotic organisms, including Borrelia species and Agrobacterium tumefaciens. The problem with replicating the lagging strand end of linear DNAs is circumvented in these organisms by the presence of covalently closed DNA hairpin telomeres at the DNA termini. Telomere resolvases are enzymes responsible for generating these hairpin telomeres from a dimeric replication intermediate through a two-step DNA cleavage and rejoining reaction referred to as telomere resolution. It was previously shown that the agrobacterial telomere resolvase, TelA, possesses ssDNA annealing activity in addition to telomere resolution activity. The annealing activity derives, chiefly, from the N-terminal domain. This domain is dispensable for telomere resolution. In this study, we used activity analyses of an N-terminal domain deletion mutant, domain add back experiments, and protein–protein interaction studies and we report that the N-terminal domain of TelA is involved in inhibitory interactions with the remainder of TelA that are relieved by the binding of divalent metal ions. We also found that the regulation of telomere resolution by the N-terminal domain of TelA extends to suppression of inappropriate enzymatic activity, including hairpin telomere fusion (reaction reversal) and recombination between replicated telomeres to form a Holliday junction.