DNA double-strand breaks (DSBs) can cause chromosomal rearrangements and extensive loss of heterozygosity (LOH), hallmarks of cancer cells. Yet, how such events are normally suppressed is unclear. Here we identify roles for the DNA damage checkpoint pathway in facilitating homologous recombination (HR) repair and suppressing extensive LOH and chromosomal rearrangements in response to a DSB. Accordingly, deletion of Rad3(ATR), Rad26ATRIP, Crb2(53BP1) or Cdc25 overexpression leads to reduced HR and increased break-induced chromosome loss and rearrangements. We find the DNA damage checkpoint pathway facilitates HR, in part, by promoting break-induced Cdt2-dependent nucleotide synthesis. We also identify additional roles for Rad17, the 9-1-1 complex and Chk1 activation in facilitating break-induced extensive resection and chromosome loss, thereby suppressing extensive LOH. Loss of Rad17 or the 9-1-1 complex results in a striking increase in break-induced isochromosome formation and very low levels of chromosome loss, suggesting the 9-1-1 complex acts as a nuclease processivity factor to facilitate extensive resection. Further, our data suggest redundant roles for Rad3ATR and Exo1 in facilitating extensive resection. We propose that the DNA damage checkpoint pathway coordinates resection and nucleotide synthesis, thereby promoting efficient HR repair and genome stability.