Eukaryotic cells have evolved to use complex pathways for DNA damage signaling and repair to maintain genomic integrity. RNF168 is a novel E3 ligase that functions downstream of ATM,γ-H2A.X, MDC1, and RNF8. It has been shown to ubiquitylate histone H2A and to facilitate the recruitment of other DNA damage response proteins, including 53BP1, to sites of DNA break. In addition, RNF168 mutations have been causally linked to the human RIDDLE syndrome. In this study, we report that Rnf168(-/-) mice are immunodeficient and exhibit increased radiosensitivity. Rnf168(-/-) males suffer from impaired spermatogenesis in an age-dependent manner. Interestingly, in contrast to H2a.x(-/-), Mdc1(-/-), and Rnf8(-/-) cells, transient recruitment of 53bp1 to DNA double-strand breaks was abolished in Rnf168(-/-) cells. Remarkably, similar to 53bp1 inactivation, but different from H2a.x deficiency, inactivation of Rnf168 impairs long-range V(D)J recombination in thymocytes and results in long insertions at the class-switch junctions of B-cells. Loss of Rnf168 increases genomic instability and synergizes with p53 inactivation in promoting tumorigenesis. Our data reveal the important physiological functions of Rnf168 and support its role in both γ-H2a.x-Mdc1-Rnf8-dependent and -independent signaling pathways of DNA double-strand breaks. These results highlight a central role for RNF168 in the hierarchical network of DNA break signaling that maintains genomic integrity and suppresses cancer development in mammals.