DNA double-strand break (DSB) repair involves complex interactions between chromatin and repair proteins, including Tip60, a tumour suppressor. Tip60 is an acetyltransferase that acetylates both histones and ATM (ataxia telangiectasia mutated) kinase. Inactivation of Tip60 leads to defective DNA repair and increased cancer risk. However, how DNA damage activates the acetyltransferase activity of Tip60 is not known. Here, we show that direct interaction between the chromodomain of Tip60 and histone H3 trimethylated on lysine 9 (H3K9me3) at DSBs activates the acetyltransferase activity of Tip60. Depletion of intracellular H3K9me3 blocks activation of the acetyltransferase activity of Tip60, resulting in defective ATM activation and widespread defects in DSB repair. In addition, the ability of Tip60 to access H3K9me3 is dependent on the DNA damage-induced displacement of HP1beta (heterochromatin protein 1beta) from H3K9me3. Finally, we demonstrate that the Mre11-Rad50-Nbs1 (MRN) complex targets Tip60 to H3K9me3, and is required to activate the acetyltransferase activity of Tip60. These results reveal a new function for H3K9me3 in coordinating activation of Tip60-dependent DNA repair pathways, and imply that aberrant patterns of histone methylation may contribute to cancer by altering the efficiency of DSB repair.