Uracil DNA glycosylases (UDGs) excise uracil from DNA and initiate the base (uracil) excision repair pathway. Ung, a highly conserved protein, is the only UDG characterized so far in mycobacteria. Here, we show that Rv1259 from Mycobacterium tuberculosis codes for a double-stranded DNA (dsDNA) specific UDG (MtuUdgB). MtuUdgB is thermo-tolerant, contains Fe-S cluster and, in addition to uracil, it excises ethenocytosine and hypoxanthine from dsDNA. MtuUdgB is product inhibited by AP-site containing dsDNA but not by uracil. While MtuUdgB excises uracil present as a single-nucleotide bulge in dsDNA, it is insensitive to inhibition by dsDNA containing AP-site in the bulge. Interestingly, in the presence of cellular factors, the uracil excision activity of MtuUdgB is enhanced, and when introduced into E. coli (ung(-)), it rescues its mutator phenotype and prevents C to T mutations in DNA. Novel features of the mechanism of action of MtuUdgB and the physiological significance of the family 5 UDG in mycobacteria have been discussed.