Germline mutations in BRCA1 confer a high risk of breast and ovarian tumors. The role of BRCA1 in tumor suppression is not yet understood, but both transcription and repair functions have been ascribed. Evidence that BRCA1 is involved in DNA repair stems from its association with RAD51, a homolog of the yeast protein involved in the repair of DNA double-strand breaks (DSBs) by homologous recombination. We report here that Brca1-deficient mouse embryonic stem cells have impaired repair of chromosomal DSBs by homologous recombination. The relative frequencies of homologous and nonhomologous DNA integration and DSB repair were also altered. The results demonstrate a caretaker role for BRCA1 in preserving genomic integrity by promoting homologous recombination and limiting mutagenic nonhomologous repair processes.