Abstract We have constructed novel DNA substrates (one inverted and three direct repeats) based on the same 0.6-kb repeat sequence to study deletions and inversions in Saccharomyces cerevisiae. Spontaneous deletions occur six to eight times more frequently than inversions, irrespective of the distance between the repeats. This difference can be explained by the observation that deletion events can be mediated by a recombination mechanism that can initiate within the intervening sequence of the repeats. Spontaneous and double-strand break (DSB)-induced deletions occur as RAD52-dependent and RAD52-independent events. Those deletion events initiated through a DSB in the unique intervening sequence require the Rad1/Rad10 endonuclease only if the break is distantly located from the flanking DNA repeats. We propose that deletions can occur as three types of recombination events: the conservative RAD52-dependent reciprocal exchange and the nonconservative events, one-ended invasion crossover, and single-strand annealing (SSA). We suggest that one-ended invasion is RAD52 dependent, whereas SSA is RAD52 independent. Whereas deletions, like inversions, occur through reciprocal exchange, deletions can also occur through SSA or one-ended invasion. We propose that the contribution of reciprocal exchange and one-ended invasion crossover vs. SSA events to overall spontaneous deletions is a feature specific for each repeat system, determined by the initiation event and the availability of the Rad52 protein. We discuss the role of the Rad1/Rad10 endonuclease on the initial steps of one-ended invasion crossover and SSA as a function of the location of the initiation event relative to the repeats. We also show that the frequency of recombination between repeats is the same independent of their location (whether on circular plasmids, linear minichromosomes, or natural chromosomes) and have similar RAD52 dependence.