The structural maintenance of chromosome (SMC) complex cohesin mediates sister chromatid cohesion established during replication, and damage-induced cohesion formed in response to DSBs post-replication. The translesion synthesis polymerase Polη is required for damage-induced cohesion through a hitherto unknown mechanism. Since Polη is functionally associated with transcription, and transcription triggers de novo cohesion in Schizosaccharomyces pombe, we hypothesized that transcription facilitates damage-induced cohesion in Saccharomyces cerevisiae. Here, we show dysregulated transcriptional profiles in the Polη null mutant (rad30Δ), where genes involved in chromatin assembly and positive transcription regulation were downregulated. In addition, chromatin association of RNA polymerase II was reduced at promoters and coding regions in rad30Δ compared to WT cells, while occupancy of the H2A.Z variant (Htz1) at promoters was increased in rad30Δ cells. Perturbing histone exchange at promoters inactivated damage-induced cohesion, similarly to deletion of the RAD30 gene. Conversely, altering regulation of transcription elongation suppressed the deficient damage-induced cohesion in rad30Δ cells. Furthermore, transcription inhibition negatively affected formation of damage-induced cohesion. These results indicate that the transcriptional deregulation of the Polη null mutant is connected with its reduced capacity to establish damage-induced cohesion. This also suggests a linkage between regulation of transcription and formation of damage-induced cohesion after replication.