AbstractAlthough gene conversion (GC) in Saccharomyces cerevisiae is the most error-free way to repair double-strand breaks (DSBs), the mutation rate during homologous recombination is 1,000 times greater than during replication. Many mutations involve dissociating a partially copied strand from its repair template and re-aligning with the same or another template, leading to −1 frameshifts in homonucleotide runs, quasipalindrome (QP)-associated mutations and microhomology-mediated interchromosomal template switches. We studied GC induced by HO endonuclease cleavage at MATα, repaired by an HMR::KI-URA3 donor. We inserted into HMR::KI-URA3 an 18-bp inverted repeat where one arm had a 4-bp insertion. Most GCs yield MAT::KI-ura3::QP + 4 (Ura−) outcomes, but template-switching produces Ura+ colonies, losing the 4-bp insertion. If the QP arm without the insertion is first encountered by repair DNA polymerase and is then (mis)used as a template, the palindrome is perfected. When the QP + 4 arm is encountered first, Ura+ derivatives only occur after second-end capture and second-strand synthesis. QP + 4 mutations are suppressed by mismatch repair (MMR) proteins Msh2, Msh3, and Mlh1, but not Msh6. Deleting Rdh54 significantly reduces QP mutations only when events creating Ura+ occur in the context of a D-loop but not during second-strand synthesis. A similar bias is found with a proofreading-defective DNA polymerase mutation (poI3-01). DSB-induced mutations differed in several genetic requirements from spontaneous events. We also created a + 1 frameshift in the donor, expanding a run of 4 Cs to 5 Cs. Again, Ura+ recombinants markedly increased by disabling MMR, suggesting that MMR acts during GC but favors the unbroken, template strand.