HO endonuclease-induced double-strand breaks in Saccharomyces cerevisiae can undergo recombination by two distinct and competing pathways. In a plasmid containing a direct repeat, in which one repeat is interrupted by an HO endonuclease cut site, gap repair yields gene conversions while single-strand annealing produces deletions. Consistent with predictions of the single-strand annealing mechanism, deletion formation is not accompanied by the formation of a reciprocal recombination product. Deletions are delayed 60 min when the distance separating the repeats is increased by 4.4 kb. Moreover, the rate of deletion formation corresponds to the time at which complementary regions become single stranded. Gap repair processes are independent of distance but are reduced in rad52 mutants and in G1-arrested cells.