A major role of the methyl-directed mismatch repair (MMR) system of Escherichia coli is to repair postreplicative errors. In this report, we provide evidence that MMR also acts on oxidized DNA, preventing mutagenesis. When cells deficient in MMR are grown anaerobically, spontaneous mutation frequencies are reduced compared with those of the same cells grown aerobically. In addition, we show that a dam mutant has an increased sensitivity to hydrogen peroxide treatment that can be suppressed by mutations that inactivate MMR. In a dam mutant, MMR is not targeted to newly replicated DNA strands and therefore mismatches are converted to single- and double-strand DNA breaks. Thus, base pairs containing oxidized bases will be converted to strand breaks if they are repaired by MMR. This is demonstrated by the increased peroxide sensitivity of a dam mutant and the finding that the sensitivity can be suppressed by mutations inactivating MMR. We demonstrate further that this repair activity results from MMR recognition of base pairs containing 8-oxoguanine (8-oxoG) based on the finding that overexpression of the MutM oxidative repair protein, which repairs 8-oxoG, can suppress the mutH-dependent increase in transversion mutations. These findings demonstrate that MMR has the ability to prevent oxidative mutagenesis either by removing 8-oxoG directly or by removing adenine misincorporated opposite 8-oxoG or both.