The repair of double-strand breaks in DNA is an essential process in all organisms, and requires the coordinated activities of evolutionarily conserved protein assemblies. One of the most critical of these is the Mre11/Rad50 (M/R) complex, which is present in all three biological kingdoms, but is not well-understood at the biochemical level. Previous structural analysis of a Rad50 homolog from archaebacteria illuminated the catalytic core of the enzyme, an ATP-binding domain related to the ABC transporter family of ATPases. Here, we present the crystallographic structure of the Rad50 mutant S793R. This missense signature motif mutation changes the key serine residue in the signature motif that is conserved among Rad50 homologs and ABC ATPases. The S793R mutation is analogous to the mutation S549R in the cystic fibrosis transmembrane conductance regulator (CFTR) that results in cystic fibrosis. We show here that the serine to arginine change in the Rad50 protein prevents ATP binding and disrupts the communication among the other ATP-binding loops. This structural change, in turn, alters the communication between Rad50 monomers and thus prevents Rad50 dimerization. The equivalent mutation was made in the human Rad50 gene, and the resulting mutant protein did form a complex with Mre11 and Nbs1, but was specifically deficient in all ATP-dependent enzymatic activities. This signature motif structure-function homology extends to yeast, because the same mutation introduced into the Saccharomyces cerevisiae RAD50 gene generated an allele that failed to complement a rad50 deletion strain in DNA repair assays in vivo. These structural and biochemical results extend our understanding of the Rad50 catalytic domain and validate the use of the signature motif mutant to test the role of Rad50 ATP binding in diverse organisms.