Novel recombinational repair of a site-specific double-strand break (DSB) in a yeast chromosome was investigated. When the recognition site for the HO endonuclease enzyme is embedded in nonyeast sequences and placed between two regions of homology, expression of HO endonuclease stimulates recombination between the homologous flanking regions to yield a deletion, the apparent product of an intrachromosomal exchange between direct repeats. This deletion-repair event is very efficient, thus preventing essentially all the potential lethality due to the persistence of a DSB. Interestingly, unlike previous studies involving spontaneous recombination between chromosomal repeats, the recombination events stimulated by HO-induced DSBs are accompanied by loss of the sequences separating the homologous regions greater than 99.5% of the time. Repair is dependent on the RAD52 gene. The deletion-repair event provides an in vivo assay for the sensitivity of any particular recognition site to HO cleavage. By taking advantage of a galactose-inducible HO gene, it has been possible to follow the kinetics of this event at the DNA level and to search for intermediates in this reaction. Deletion-repair requires approximately 45 min and is inhibited when cycloheximide is added after HO endonuclease cleavage.