The genetic disorder, ataxia-telangiectasia (A-T), combines genome instability with tissue degeneration, cancer predisposition and premature aging. It is caused by loss of the protein kinase ATM, which mobilizes the DNA damage response. Primary fibroblasts from A-T patients exhibit premature senescence when grown at ambient oxygen concentration (21%). Here, we show that reducing oxygen concentration to a physiological level (3%) dramatically extends the proliferative lifespan of human A-T skin fibroblasts. However, they still undergo senescence earlier than control cells grown under the same conditions and exhibit increased amounts of micronuclei, representing genome instability. Comparative RNA-seq analysis of A-T and control fibroblasts cultured at 3% oxygen, followed by cluster analysis of differentially expressed genes and functional enrichment analysis, revealed distinct transcriptional dynamics in senescing A-T cells. While some transcriptional patterns were similar to those observed during replicative senescence of control cells, others were unique to the prematurely senescing A-T cells. We observed in these cells a robust activation of interferon-stimulated genes without activation of the interferon genes themselves, suggesting non-canonical activation of the cGAS-STING pathway, which presumably responded to cytosolic DNA emanating from the micronuclei. A-T cells also exhibited a marked, intriguely complex alteration in the expression of genes associated with extracellular matrix (ECM) remodeling. Notably, many of the induced ECM genes encode senescence-associated secretory phenotype (SASP) factors that are known for their pro-fibrotic effects. Our data provide a molecular dimension to the segmental premature aging observed in A-T patients and its associated symptoms, which develop as the patients advance in age.