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In May 2014, Telfer joined the North American Soccer League team Indy Eleven as an assistant coach working under head coach Juergen Sommer who was a teammate during his time at Luton Town F.C.. On 2 June 2015, Telfer was released from the coaching staff of Indy Eleven along with Sommer

In 2011, he joined the coaching staff at Sutton United and also agreed to make a return to the playing side of the game.

But after some poor performances by Leeds' centre backs, Telfer found himself playing in an unfamiliar centre back role after impressing for Leeds in the position in a League Cup game against Crystal Palace. Telfer at first put in some assured performances, but as the season went on Leeds became very vulnerable, with Telfer's lack of pace being exposed. Most notably in injury time against Huddersfield Town after Leeds conceded a goal, where Telfer's lack of pace was badly exposed. Gary McAllister was sacked in December, and new manager Simon Grayson left Telfer out of all of his first team squads during his first month at the club. On 2 February 2009, his contract was cancelled by mutual consent with Telfer saying he didn't want Leeds to spend money paying his wages whilst he wasn't going to play.

In April 2009, Telfer signed for non-league Slough Town, but failed to appear in the 2009–10 season. In the 2011 close-season, it was announced that Telfer would be joining Sutton United in a player/coach capacity.

Telfer is a keen golfer. As of June 2009, his handicap was two shots.

On 8 August 2008, Telfer came out of retirement for a second time and joined Leeds United on a non-contract basis after initially training with Leeds to keep fitness. He signed a 1-year deal with the club at the end of August. Impressing his former teammate Gary McAlliser who was managing Leeds at the time. Telfer was expected to act as cover for right back Frazer Richardson.

On 13 July 2007, Telfer came out of retirement, signing a one-year contract with League One side Bournemouth. On 12 December 2007, Telfer cancelled his contract with Bournemouth to help their financial problems. A few days earlier, he had been ruled out for the season with a foot injury that required surgery and retired again.

In 2005, Strachan became manager at Celtic, and again made Telfer one of his first signings. Telfer played just under two years at Parkhead, where he won two Scottish League championships and scored once in the league against Aberdeen. However, his family had difficulty settling in Glasgow, and on 3 December 2006, Telfer announced he would not renew his contract with Celtic because he wished to spend more time with his family in Winchester. On 2 April 2007, Telfer brought forward his retirement and officially left Celtic to be with his family in England.

In October 2001, shortly after Coventry's relegation from the Premiership, Telfer joined Southampton, who had appointed Strachan as manager just over a month earlier. At Southampton, Telfer was converted from midfielder to right-back, and was a member of the side that reached the 2003 FA Cup Final. He scored once during his spell at Southampton, in a 3–1 win over Newcastle in May 2002.

In the summer of 1995, he was signed by manager Ron Atkinson for Coventry City, where he began his long association with Gordon Strachan, who at the time was player-coach at the club, and later became manager. While at Coventry, Telfer won his only senior Scotland cap. Selected by Craig Brown he played in Scotland's 2–0 friendly defeat against France on 29 March 2000 at Hampden Park.

Telfer made over 300 league appearances in the Premier League for Coventry City and Southampton between 1995 and 2005, whilst with Coventry he was capped once by Scotland and had also previously played over 150 times for Luton Town. In 2005, he signed for Scottish Premier League side Celtic where he made 57 appearances in two seasons in his native country. He has since gone on to feature for Bournemouth and Leeds United before finishing his career with non-league side Slough Town in 2009.

In November 1992, Telfer and then Luton teammate Darren Salton were involved in a head on car crash in Bedfordshire. Telfer, the driver of the car, suffered only minor injuries and went on to make a full recovery. Salton spent seven days on a life support machine and a further two and half weeks in a coma. Salton was forced to quit football following the accident. A 51-year-old female passenger in the other car was killed.

Paul Norman Telfer (born 21 October 1971) is a Scottish former professional footballer.