Using only a limited repertoire of recognition subunits, the nucleotide excision repair (NER) system is able to detect a nearly infinite variety of bulky DNA lesions. This extraordinary substrate versatility has generally been ascribed to an indirect readout mechanism, whereby particular distortions of the double helix, induced by a damaged nucleotide, provide the molecular determinants not only for lesion recognition but also for subsequent verification or demarcation processes. Here, we discuss the evidence in support of a bipartite mechanism of substrate discrimination that is initiated by the detection of thermodynamically unstable base pairs followed by direct localization of the lesion through an enzymatic proofreading activity. This bipartite discrimination mechanism is part of a dynamic reaction cycle that confers high levels of selectivity to avoid futile repair events on undamaged DNA and also protect the intact complementary strand from inappropriate cleavage.