Efficient genetic recombination requires near-perfect homology between participating molecules. Sequence divergence reduces the frequency of recombination, a process that is dependent on the activity of the mismatch repair system. The effects of chromosomal divergence in diploids of Saccharomyces cerevisiae in which one copy of chromosome III is derived from a closely related species, Saccharomyces paradoxus, have been examined. Meiotic recombination between the diverged chromosomes is decreased by 25-fold. Spore viability is reduced with an observable increase in the number of tetrads with only two or three viable spores. Asci with only two viable spores are disomic for chromosome III, consistent with meiosis I nondisjunction of the homeologs. Asci with three viable spores are highly enriched for recombinants relative to tetrads with four viable spores. In 96% of the class with three viable spores, only one spore possesses a recombinant chromosome III, suggesting that the recombination process itself contributes to meiotic death. This phenomenon is dependent on the activities of the mismatch repair genes PMS1 and MSH2. A model of mismatch-stimulated chromosome loss is proposed to account for this observation. As expected, crossing over is increased in pms1 and msh2 mutants. Furthermore, genetic exchange in pms1 msh2 double mutants is affected to a greater extent than in either mutant alone, suggesting that the two proteins act independently to inhibit homeologous recombination. All mismatch repair-deficient strains exhibited reductions in the rate of chromosome III nondisjunction.