The 40 kV high-resolution transmission electron microscopy (TEM) experiments are performed to understand defect formation and evolution of their atomic structure in single-layer 2H MoTe2 under electron beam irradiation. We show that Te vacancies can agglomerate either in single Te vacancy lines or in extended defects composed of column Te vacancies, including rotational trefoil-like defects, with some of them being never reported before. The formation of inversion domains with mirror twin boundaries of different types, along with the islands of the metallic T' phase was also observed. Our first-principles calculations provide insights into the energetics of the transformations as well as the electronic structure of the system with defects and point out that some of the observed defects have localized magnetic moments. Our results indicate that various nanoscale structures, including metallic quantum dots consisting of T' phase islands and one-dimensional metallic quantum systems such as vacancy lines and mirror twin boundaries embedded into a semiconducting host material can be realized in single-layer 2H MoTe2, and defect-associated magnetism can also be added, which may allow prospective control of optical and electronic properties of two-dimensional materials.