The ribonucleoprotein telomerase is an RNA-dependent DNA polymerase that catalyzes the repetitive addition of a short, species-specific, DNA sequence to the ends of linear eukaryotic chromosomes. The single RNA component of telomerase contains both the template sequence for DNA synthesis and a functionally critical pseudoknot motif, which can also exist as a less stable hairpin. Here we use a minimal version of the human telomerase RNA pseudoknot to study this hairpin-pseudoknot structural equilibrium using temperature-controlled single-molecule fluorescence resonance energy transfer (smFRET) experiments. The urea dependence of these experiments aids in determination of the folding kinetics and thermodynamics. The wildtype pseudoknot behavior is compared and contrasted to a mutant pseudoknot sequence implicated in a genetic disorder-dyskeratosis congenita. These findings clearly identify that this 2nt noncomplementary mutation destabilizes the folding of the wild-type pseudoknot by substantially reducing the folding rate constant (approximate to 400-fold) while only nominally increasing the unfolding rate constant (approximate to 5-fold). Furthermore, the urea dependence of the equilibrium and rate constants is used to develop a free energy landscape for this unimolecular equilibrium and propose details about the structure of the transition state. Finally, the urea-dependent folding experiments provide valuable physical insights into the mechanism for destabilization of RNA pseudoknots by such chemical denaturants.