Senescence is a cellular state which involves cell cycle arrest and a proinflammatory phenotype, and it has traditionally been associated with cellular and organismal aging. However, increasing evidence suggests key roles in tissue growth and regrowth, especially during development and regeneration. Conversely, cellular plasticity—the capacity of cells to undergo identity change, including differentiation and dedifferentiation—is associated with development and regeneration but is now being investigated in the context of age-related diseases such as Alzheimer disease. Here, we discuss the paradox of the role for cellular senescence in cellular plasticity: senescence can act as a cell-autonomous barrier and a paracrine driver of plasticity. We provide a conceptual framework for integrating recent data and use the interplay between cellular senescence and plasticity to provide insight into age-related diseases. Finally, we argue that age-related diseases can be better deciphered when senescence is recognized as a core mechanism of regeneration and development.