The eight Petrogale (rock-wallaby) species of the penicillata complex have a variable rate of karyotypic evolution, with species differing from the ancestral karyotype by two to six rearrangements. The distribution of the predominant vertebrate telomeric sequence (T2AG3)n was examined by fluorescence in situ hybridization (FISH) to determine if this sequence is retained during centric fusion events or is involved in other rearrangements. In all submetacentric chromosomes derived by centric fusions, the telomeric sequence was identified at or near the centromere, indicating that the (T2AG3)n sequence is consistently retained. In two acrocentric chromosomes, derived by centromeric transpositions from submetacentric fusion chromosomes, an interstitial signal was observed at the presumed site of the fusion. This represents the identification of a novel mechanism by which the (T2AG3)n sequence may become interstitial. Other interstitial telomeric signals were identified just below the centromere of chromosome 1 and interstitially on chromosome 4 in all eight species of the penicillata complex. These may be related to, respectively, the formation of euchromatic short arms on chromosome 1 and a more ancient rearrangement of chromosome 4 within marsupials.