Cyclobutane pyrimidine dimers (CPDs) and 6-4 photoproducts (6-4PPs) comprise major UV-induced photolesions. If left unrepaired, these lesions can induce mutations and skin cancer, which is facilitated by UV-induced immunosuppression. Yet the contribution of lesion and cell type specificity to the harmful biological effects of UV exposure remains currently unclear. Using a series of photolyase-transgenic mice to ubiquitously remove either CPDs or 6-4PPs from all cells in the mouse skin or selectively from basal keratinocytes, we show that the majority of UV-induced acute effects to require the presence of CPDs in basal keratinocytes in the mouse skin. At the fundamental level of gene expression, CPDs induce the expression of genes associated with repair and recombinational processing of DNA damage, as well as apoptosis and a response to stress. At the organismal level, photolyase-mediated removal of CPDs, but not 6-4PPs, from the genome of only basal keratinocytes substantially diminishes the incidence of skin tumors; however, it does not affect the UVB-mediated immunosuppression. Taken together, these findings reveal a differential role of basal keratinocytes in these processes, providing novel insights into the skin's acute and chronic responses to UV in a lesion- and cell-type-specific manner.