Tolerance to replication-blocking DNA lesions is achieved by means of ubiquitylation of PCNA, the processivity clamp for replicative DNA polymerases, by components of the RAD6 pathway. In the yeast Saccharomyces cerevisiae the ubiquitin ligase (E3) responsible for polyubiquitylation of the clamp is the RING finger protein Rad5p. Interestingly, the RING finger, responsible for the protein's E3 activity, is embedded in a conserved DNA-dependent ATPase domain common to helicases and chromatin remodeling factors of the SWI/SNF family. Here, we demonstrate that the Rad5p ATPase domain provides the basis for a function of the protein in DNA double-strand break repair via a RAD52- and Ku-independent pathway mediated by the Mre11/Rad50/Xrs2 protein complex. This activity is distinct and separable from the contribution of the RING domain to ubiquitin conjugation to PCNA. Moreover, we show that the Rad5 protein physically associates with the single-stranded DNA regions at a processed double-strand break in vivo. Our observations suggest that Rad5p is a multifunctional protein that--by means of independent enzymatic activities inherent in its RING and ATPase domains--plays a modulating role in the coordination of repair events and replication fork progression in response to various different types of DNA lesions.