DNA double-strand breaks (DSBs) are repaired by homologous recombination (HR) and nonhomologous end-joining (NHEJ). NHEJ in yeast chromosomes has been observed only when HR is blocked, as in rad52 mutants or in the absence of a homologous repair template. We detected yKu70p-dependent imprecise NHEJ at a frequency of approximately 0.1% in HR-competent Rad+ haploid cells. Interestingly, yku70 mutation increased DSB-induced HR between direct repeats by 1.3-fold in a haploid strain and by 1.5-fold in a MAT homozygous (a/a) diploid, but yku70 had no effect on HR in a MAT heterozygous (a/alpha) diploid. yku70 might increase HR because it eliminates the competing precise NHEJ (religation) pathway and/or because yKu70p interferes directly or indirectly with HR. Despite the yku70-dependent increase in a/a cells, HR remained 2-fold lower than in a/alpha cells. Cell survival was also lower in a/a cells and correlated with the reduction in HR. These results indicate that MAT heterozygosity enhances DSB-induced HR by yKu-dependent and -independent mechanisms, with the latter mechanism promoting cell survival. Surprisingly, yku70 strains survived a DSB slightly better than wild type. We propose that this reflects enhanced HR, not by elimination of precise NHEJ since this pathway produces viable products, but by elimination of yKu-dependent interference of HR.