Abstract: Gross chromosomal rearrangements (GCRs) are large scale changes to chromosome structure, and can lead to human disease. We previously showed in Saccharomyces cerevisiae, that nearby inverted repeat sequences (~20 to 200bp of homology, separated by ~1-5kb) frequently fuse to form unstable dicentric and acentric chromosomes. Here we analyzed inverted repeat fusion in mutants of three sets of genes. First, we show that genes in the error-free post replication repair pathway prevent fusion of inverted repeats, while genes in the translesion branch have no detectable role. Second, we found that siz1 mutants, which are defective for Srs2 recruitment to replication forks, and srs2 mutants had opposite effects on instability. This may reflect separate roles for Srs2 in different phases of the cell cycle. Third, we provide evidence for a faulty template-switch model by studying mutants of DNA polymerases; defects in DNA pol delta (lagging strand polymerase) and Mgs1 (a pol delta interacting protein) lead to a defect in fusion events as well as allelic recombination. Pol delta and Mgs1 may collaborate either in strand annealing and/or DNA replication involved in fusion and allelic recombination events. Fourth, by studying genes implicated in suppression of GCRs in other studies, we found that inverted repeat fusion has a profile of genetic regulation distinct from these other major forms of GCR formation.