Sub-regions of hypoxia exist within all tumors and the presence of intratumoral hypoxia has an adverse impact on patient prognosis. Tumor hypoxia can increase metastatic capacity and lead to resistance to chemotherapy and radiotherapy. Hypoxia also leads to altered transcription and translation of a number of DNA damage response and repair genes. This can lead to inhibition of recombination-mediated repair of DNA double-strand breaks. Hypoxia can also increase the rate of mutation. Therefore, tumor cell adaptation to the hypoxic microenvironment can drive genetic instability and malignant progression. In this review, we focus on hypoxia-mediated genetic instability in the context of aberrant DNA damage signaling and DNA repair. Additionally, we discuss potential therapeutic approaches to specifically target repair-deficient hypoxic tumor cells.