In Saccharomyces cerevisiae, Mre11p, Rad50p, and Xrs2p function as a multiprotein complex that has a central role in several DNA repair mechanisms. Though Mre11p has both single-stranded and double-stranded 3'-5' exonuclease activity in vitro, null mutants of MRE11, RAD50, and XRS2 exhibit reduced 5'-3' resection of HO-induced double-strand breaks (DSBs) in vivo. In this study, we analyzed four mre11 mutants harboring changes in the N-terminus of Mre11p where the four phosphoesterase motifs specify the in vitro nuclease activities of Mre11p and its homologues. We find that the 5'-3' resection defects in vivo do not correlate with several mitotic phenotypes: non-homologous end-joining (NHEJ), telomere length maintenance, and adaptation to the DNA damage-inducible G2/M checkpoint. Overexpression of the 5'-3' exonuclease Exo1p in a mre11Delta strain partially increased 5'-3' resection and partially suppressed both methyl methanesulfonate (MMS) hypersensitivity and adaptation phenotypes, but did not affect telomere length or NHEJ. Surprisingly, the co-expression of two alleles, mre11-58S and mre11-N113S, each of which confers MMS hypersensitivity and short telomeres, can fully complement the MMS sensitivity and shortened telomere length of mre11Delta cells. We propose that at least two separate activities associated with the N-terminus of Mre11p are required for its mitotic function.