Cells that suffer substantial inhibition of DNA replication halt their cell cycle via a checkpoint response mediated by the PI3 kinases ATM and ATR. It is unclear how cells cope with milder replication insults, which are under the threshold for ATM and ATR activation. A third PI3 kinase, DNA-dependent protein kinase (DNA-PK), is also activated following replication inhibition, but the role DNA-PK might play in response to perturbed replication is unclear, since this kinase does not activate the signaling cascades involved in the S-phase checkpoint. Here we report that mild, transient drug-induced perturbation of DNA replication rapidly induced DNA breaks that promptly disappeared in cells that contained a functional DNA-PK whereas such breaks persisted in cells that were deficient in DNA-PK activity. After the initial transient burst of DNA breaks, cells with a functional DNA-PK did not halt replication and continued to synthesize DNA at a slow pace in the presence of replication inhibitors. In contrast, DNA-PK deficient cells subject to low levels of replication inhibition halted cell cycle progression via an ATR-mediated S-phase checkpoint. The ATM kinase was dispensable for the induction of the initial DNA breaks. These observations suggest that DNA-PK is involved in setting a high threshold for the ATR-Chk1-mediated S-phase checkpoint by promptly repairing DNA breaks that appear immediately following inhibition of DNA replication.