Chromosomal double-strand breaks (DSBs) that have only one end with homology to a donor duplex undergo repair by strand invasion followed by replication to the chromosome terminus (break-induced replication, BIR). Using a transformation-based assay system, it was previously shown that BIR could occur by several rounds of strand invasion, DNA synthesis, and dissociation. Here we describe a modification of the transformation-based assay to facilitate detection of switching between donor templates during BIR by genetic selection in diploid yeast. In addition to the expected recovery of template switch products, we found a high frequency of recombination between chromosome homologs during BIR, suggesting transfer of the DSB from the transforming linear DNA to the donor chromosome, initiating secondary recombination events. The frequency of BIR increased in the mph1Δ mutant, but the percentage of template switch events was significantly decreased, revealing an important role for Mph1 in promoting BIR-associated template switching. In addition, we show that the Mus81, Rad1, and Yen1 structure-selective nucleases act redundantly to facilitate BIR.