Nonhomologous end joining (NHEJ) eliminates DNA double-strand breaks (DSBs) in bacteria and eukaryotes. In Saccharomyces cerevisiae, there are pairwise physical interactions among the core complexes of the NHEJ pathway, namely Yku70-Yku80 (Ku), Dnl4-Lif1 and Mre11-Rad50-Xrs2 (MRX). However, MRX also has a key role in the repair of DSBs by homologous recombination (HR). Here we have examined the assembly of NHEJ complexes at DSBs biochemically and by chromatin immunoprecipitation. Ku first binds to the DNA end and then recruits Dnl4-Lif1. Notably, Dnl4-Lif1 stabilizes the binding of Ku to in vivo DSBs. Ku and Dnl4-Lif1 not only initiate formation of the nucleoprotein NHEJ complex but also attenuate HR by inhibiting DNA end resection. Therefore, Dnl4-Lif1 plays an important part in determining repair pathway choice by participating at an early stage of DSB engagement in addition to providing the DNA ligase activity that completes NHEJ.