Faithful duplication of the genome requires structure-specific endonucleases such as the RuvABC complex in Escherichia coli. These enzymes help to resolve problems at replication forks that have been disrupted by DNA damage in the template. Much less is known about the identities of these enzymes in mammalian cells. Mus81 is the catalytic component of a eukaryotic structure-specific endonuclease that preferentially cleaves branched DNA substrates reminiscent of replication and recombination intermediates. Here we explore the mechanisms by which Mus81 maintains chromosomal stability. We found that Mus81 is involved in the formation of double-strand DNA breaks in response to the inhibition of replication. Moreover, in the absence of chromosome processing by Mus81, recovery of stalled DNA replication forks is attenuated and chromosomal aberrations arise. We suggest that Mus81 suppresses chromosomal instability by converting potentially detrimental replication-associated DNA structures into intermediates that are more amenable to DNA repair.