Yeast RNA polymerase II initiation factor b, homolog of human TFIIH, is a protein kinase capable of phosphorylating the C-terminal repeat domain of the polymerase; it possesses a DNA-dependent ATPase activity as well. The 85 kd and 50 kd subunits of factor b are now identified as RAD3 and SSL1 proteins, respectively; both are known to be involved in DNA repair. Factor b interacts specifically with another DNA repair protein, SSL2. The ATPase activity of factor b may be due entirely to that associated with a helicase function of RAD3. Factor b transcriptional activity was unaffected, however, by amino acid substitution at a conserved residue in the RAD3 nucleotide-binding domain, suggesting that the ATPase/helicase function is not required for transcription. These results identify factor b as a core repairosome, which may be responsible for the preferential repair of actively transcribed genes in eukaryotes.