Defects in the genes encoding the Paf1 complex can cause increased genome instability. Loss of Paf1, Cdc73, and Ctr9, but not Rtf1 or Leo1, caused increased accumulation of gross chromosomal rearrangements (GCRs). Combining the cdc73Δ mutation with individual deletions of 43 other genes, including TEL1 and YKU80, which are involved in telomere maintenance, resulted in synergistic increases in GCR rates. Whole genome sequence analysis of GCRs indicated that there were reduced relative rates of GCRs mediated by de novo telomere additions and increased rates of translocations and inverted duplications in cdc73Δ single and double mutants. Analysis of telomere lengths and telomeric gene silencing in strains containing different combinations of cdc73Δ, tel1Δ and yku80Δ mutations suggested that combinations of these mutations caused increased defects in telomere maintenance. A deletion analysis of Cdc73 revealed that a central 105 amino acid region was necessary and sufficient for suppressing the defects observed in cdc73Δ strains; this region was required for the binding of Cdc73 to the Paf1 complex through Ctr9 and for nuclear localization of Cdc73. Taken together, these data suggest that the increased GCR rate of cdc73Δ single and double mutants is due to partial telomere dysfunction and that Ctr9 and Paf1 play a central role in the Paf1 complex potentially by scaffolding the Paf1 complex subunits or by mediating recruitment of the Paf1 complex to the different processes it functions in.