TRF2 (telomeric repeat binding factor 2) is an essential component of the telomeric cap, where it forms and stabilizes the T-loop junctions. TRF2 forms the T-loops by stimulating strand invasion of the 3′ overhang into duplex DNA. TRF2 also has been shown to localize to nontelomeric DNA double-strand breaks, but its functional role in DNA repair has not been examined. Here, we present evidence that TRF2 is involved in homologous recombination (HR) repair of nontelomeric double-strand breaks. Depletion of TRF2 strongly inhibited HR and delayed the formation of Rad51 foci after γ-irradiation, whereas overexpression of TRF2 stimulated HR. Depletion of TRF2 had no effect on nonhomologous end-joining, and overexpression of TRF2 inhibited nonhomologous end-joining. We propose, based on our results and on the ability of TRF2 to mediate strand invasion, that TRF2 plays an essential role in HR by facilitating the formation of early recombination intermediates.