Cells experience damage from exogenous and endogenous sources that endanger genome stability. Several cellular pathways have evolved to detect DNA damage and mediate its repair. Although many proteins have been implicated in these processes, only recent studies have revealed how they operate in the context of high-ordered chromatin structure. Here, we identify the nuclear oncogene SET (I2PP2A) as a modulator of DNA damage response (DDR) and repair in chromatin surrounding double-strand breaks (DSBs). We demonstrate that depletion of SET increases DDR and survival in the presence of radiomimetic drugs, while overexpression of SET impairs DDR and homologous recombination (HR)-mediated DNA repair. SET interacts with the Kruppel-associated box (KRAB)-associated co-repressor KAP1, and its overexpression results in the sustained retention of KAP1 and Heterochromatin protein 1 (HP1) on chromatin. Our results are consistent with a model in which SET-mediated chromatin compaction triggers an inhibition of DNA end resection and HR.