To ensure efficient and timely replication of genomic DNA, organisms in all three kingdoms of life possess specialized translesion DNA synthesis (TLS) polymerases (Pols) that tolerate various types of DNA lesions. It has been proposed that an exchange between the replicative DNA Pol and the TLS Pol at the site of DNA damage enables lesion bypass to occur. However, to date the molecular mechanism underlying this process is not fully understood. In this study, we demonstrated in a reconstituted system that the exchange of Saccharomyces cerevisiae Polδ with Polη requires both the stalling of the holoenzyme and the monoubiquitination of proliferating cell nuclear antigen (PCNA). A moving Polδ holoenzyme is refractory to the incoming Polη. Furthermore, we showed that the Polη C-terminal PCNA-interacting protein motif is required for the exchange process. We also demonstrated that the second exchange step to bring back Polδ is prohibited when Lys-164 of PCNA is monoubiquitinated. Thus the removal of the ubiquitin moiety from PCNA is likely required for the reverse exchange step after the lesion bypass synthesis by Polη.