Double-strand breaks (DSBs) in chromosomal DNA elicit a rapid signaling response through the ATM protein kinase. ATM corresponds to Tel1 in budding yeast. Here we show that the catalytic activity of Tel1 is altered by protein binding at DNA ends via the Mre11-Rad50-Xrs2 (MRX) complex. Like ATM, Tel1 is activated through interaction with the MRX complex and DNA ends. In vivo, Tel1 activation is enhanced in sae2⌬ or mre11-3 mutants after camptothecin treatment; both of these mutants are defective in the removal of topoisomerase I from DNA. In contrast, an sae2⌬ mutation does not stimulate Tel1 activation after expression of the EcoRI endonuclease, which generates "clean" DNA ends. In an in vitro system, tethering of Fab fragments to DNA ends inhibits MRX-mediated DNA end processing but enhances Tel1 activation. The mre11-3 mutation abolishes DNA end-processing activity but does not affect the ability to enhance Tel1 activation. These results support a model in which MRX controls Tel1 activation by recognizing protein-bound DNA ends. Double-strand DNA breaks (DSBs) are deleterious DNA lesions that threaten genomic integrity if not precisely repaired. DSBs are induced not only by exogenous DNA-damaging agents but also during physiological cellular processes such as meiosis, lymphoid differentiation, and DNA replication. All organisms respond to DSBs by promptly launching the DNA damage response, which consists of checkpoint signaling and DNA repair (22,82). Cells possess two principal pathways for DSB repair: homologous recombination (HR) and nonhomologous end joining (NHEJ) (21). NHEJ rejoins DNA ends in the absence of significant homology (11, 36), whereas HR rejoins DSBs using a homologous donor sequence as a template (30). The Mre11-Rad50-Nbs1 (MRN) complex, which corresponds to the Mre11-Rad50-Xrs2 (MRX) complex in budding yeast, plays a key role in both the HR and NHEJ pathways (13,20,58,78). An early step in HR involves the generation of single-stranded DNA (ssDNA), followed by invasion of the template strand and DNA synthesis. To create ssDNA tracts at DSB ends, the MRN/MRX complex collaborates with several factors, including Sae2/Ctp1/CtIP, Dna2 nuclease, Sgs1/BLM helicase, and Exo1 exonuclease (18,33,37,44,60,83). Studies of budding yeast have proposed the model in which MRX and Sae2 act on DSBs at an earlier step than Sgs1, Dna2, and Exo1 (18,44,83). MRN/MRX is involved not only in generating ssDNA tracts but also in removing DNAprotein cross-links from DNA ends. The topoisomerase-like protein Spo11 becomes covalently bound to the 5Ј end of the DNA during meiotic DSB formation (28). MRX/MRN and Sae2/Ctp1 are involved in the removal of Spo11/Rec12 from 5Ј ends in budding and fission yeasts (23,29,43,49,59). The fission yeast MRN complex contributes to the removal of topoisomerase II from 5Ј ends as well as to the removal of topoisomerase I (Top1) from 3Ј ends (24).The checkpoint response that is activated by DSBs depends on the phosphatidylinositol 3-kinase related protein kinases ATM and ATR (22,82). Wher...