Anticancer topoisomerase "poisons" exploit the break-and-rejoining mechanism of topoisomerase II (TOP2) to generate TOP2-linked DNA double-strand breaks (DSBs). This characteristic underlies the clinical efficacy of TOP2 poisons, but is also implicated in chromosomal translocations and genome instability associated with secondary, treatment-related, haematological malignancy. Despite this relevance for cancer therapy, the mechanistic aspects governing repair of TOP2-induced DSBs and the physiological consequences that absent or aberrant repair can have are still poorly understood. To address these deficits, we employed cells and mice lacking tyrosyl DNA phosphodiesterase 2 (TDP2), an enzyme that hydrolyses 5'-phosphotyrosyl bonds at TOP2-associated DSBs, and studied their response to TOP2 poisons. Our results demonstrate that TDP2 functions in non-homologous end-joining (NHEJ) and liberates DSB termini that are competent for ligation. Moreover, we show that the absence of TDP2 in cells impairs not only the capacity to repair TOP2-induced DSBs but also the accuracy of the process, thus compromising genome integrity. Most importantly, we find this TDP2-dependent NHEJ mechanism to be physiologically relevant, as Tdp2-deleted mice are sensitive to TOP2-induced damage, displaying marked lymphoid toxicity, severe intestinal damage, and increased genome instability in the bone marrow. Collectively, our data reveal TDP2-mediated error-free NHEJ as an efficient and accurate mechanism to repair TOP2-induced DSBs. Given the widespread use of TOP2 poisons in cancer chemotherapy, this raises the possibility of TDP2 being an important etiological factor in the response of tumours to this type of agent and in the development of treatment-related malignancy.