A predominant pathway implicated in repair of DNA double-strand breaks (DSBs) is the evolutionarily conserved non-homologous end-joining (NHEJ) pathway. Among the major constituents of this pathway in Saccharomyces cerevisiae is Nej1p, for which a biochemical function has yet to be determined. In this work we demonstrate that Nej1p exhibits a DNA binding activity (KD approximately 1.8 microM) comparable to Lif1p. Although binding is enhanced with larger substrates (>300 bp), short approximately 20 bp substrates can suffice. This DNA binding activity is the first biochemical evidence supporting the idea that Nej1p plays a direct role in the repair of double-strand breaks. The C-terminus of Nej1p is required for interaction with Lif1p and is sufficient for DNA binding. Structural characterization reveals that Nej1p exists as a dimer, and that residues 1-244 are sufficient for dimer formation. Nej1p (aa 1-244) is shown to be defective in end-joining in vivo. Preliminary functional and structural studies on the Nej1p-Lif1p complex suggest that the proteins stably co-purify and the complex binds DNA with a higher affinity than each independent component. The significance of these results is discussed with reference to current literature on Nej1p and other end-joining factors (mammalian and yeast), specifically the recently identified putative mammalian homologue of Nej1p, XLF/Cernunnos.