The Chk1 kinase is required for the arrest of cell cycle progression when DNA is damaged, and for stabilizing stalled replication forks. As a consequence, many Chk1 inhibitors have been developed and tested for their potential to enhance DNA damage-induced tumor cell killing. However, inhibition of Chk1 alone, without any additional exogenous agent, can be cytotoxic. Understanding the underlying mechanisms of this sensitivity is critical for defining which patients might respond best to therapy with Chk1 inhibitors. We have investigated the mechanism of sensitivity in U2OS osteosarcoma cells. Upon incubation with the Chk1 inhibitor MK-8776, single-stranded DNA regions (ssDNA) and double-strand breaks (DSB) begin to appear within 6 h. These DSB have been attributed to the structure-specific DNA endonuclease, Mus81. The Mre11/Rad50/Nbs1 complex is known to be responsible for the resection of DSB to ssDNA. However, we show that inhibition of the Mre11 nuclease activity leads, not only to a decrease in the amount of ssDNA following Chk1 inhibition, but also inhibits the formation of DSB, suggesting that DSB are a consequence of ssDNA formation. These findings were corroborated by the discovery that Mre11-deficient ATLD1 cells are highly resistant to MK-8776 and form neither ssDNA nor DSB following treatment. However, once complimented with exogenous Mre11, the cells accumulate both ssDNA and DSB when incubated with MK-8776. Our findings suggest that Mre11 provides the link between aberrant activation of Cdc25A/Cdk2 and Mus81. The results highlight a novel role for Mre11 in the production of DSB and may help define which tumors are more sensitive to MK-8776 alone or in combination with DNA damaging agents.