Two RecA homologues have been identified to date in Ustilago maydis. One is orthologous to Rad51 while the other, Rec2, is structurally quite divergent and evolutionarily distant. DNA repair and recombination proficiency in U. maydis requires both Rec2 and Rad51. Here we have examined biochemical activities of Rec2 protein purified after overexpression of the cloned gene. Rec2 requires DNA as a cofactor to hydrolyze ATP and depends on ATP to promote homologous pairing and DNA strand exchange. ATPgammaS was found to substitute for ATP in all pairing reactions examined. With superhelical DNA and a homologous single-stranded oligonucleotide as substrates, Rec2 actively promoted formation and dissociation of D-loops. When an RNA oligonucleotide was substituted it was found that R-loops could also be formed and utilized as primer/template for limited DNA synthesis. In DNA strand exchange reactions using oligonucleotides, we found that Rec2 exhibited a pairing bias that is opposite that of RecA. Single-stranded oligonucleotides were activated for DNA strand exchange when attached as tails protruding from a duplex sequence due to enhanced binding of Rec2. The results indicate that Rec2 is competent, and in certain ways even better than Rad51, in the ability to provide the fundamental DNA pairing activity necessary for recombinational repair. We propose that the emerging paradigm for homologous recombination featuring Rad51 as the essential catalytic component for strand exchange may not be universal in eukaryotes.