We previously identified two distinct genes of Saccharomyces cerevisiae redoxyendonuclease (SCR1 and SCR2) which possess a high degree of sequence similarity to Escherichia coli endonuclease III [Augeri, L., Lee, Y. M., Barton, A. B., and Doetsch, P. W. (1997) Biochemistry 36, 721-729]. The proteins encoded by SCR1 and SCR2 were overexpressed in E. coli and purified to apparent homogeneity. Both proteins recognized and cleaved DNA substrates containing dihydrouracil, 2,6-diamino-4-hydroxy-5N-methylformamidopyrimidine (FaPy-7-MeGua), and abasic sites but not DNA substrates containing uracil or 8-oxoguanine. Purified Scr2, but not Scr1, possesses spectral properties which indicate the presence of an iron-sulfur center. Kinetic parameters for Scr1 and Scr2 were determined by using an oligonucleotide containing a single dihydrouracil. Analysis of the deduced amino acid sequences of Scr1 and Scr2 suggests that Scr2 bears an iron-sulfur motif, while Scr1 does not have this motif. However, Scr1 has a long, positively charged N-terminus that could be a mitochondrial transit sequence. Targeted gene disruption of SCR1 and SCR2 produced a double mutant that had no detectable enzymatic activity against the dihydrouracil-containing substrate. Northern blot analysis showed that SCR1 was induced by menadione, but SCR2 was not. These results indicate that although Scr1 and Scr2 are both functional homologues of E. coli endonuclease III, they differ from each other with respect to their amino acid sequences and inducibility by DNA damaging agents, suggesting that their precise biological roles may be different.