The moss Physcomitrella patens is unique among plant models for the high frequency with which targeted transgene insertion occurs via homologous recombination. Transgene integration is believed to utilize existing machinery for the detection and repair of DNA double-strand breaks (DSBs). We undertook targeted knockout of the Physcomitrella genes encoding components of the principal sensor of DNA DSBs, the MRN complex. Loss of function of PpMRE11 or PpRAD50 strongly and specifically inhibited gene targeting, whilst rates of untargeted transgene integration were relatively unaffected. In contrast, disruption of the PpNBS1 gene retained the wild-type capacity to integrate transforming DNA efficiently at homologous loci. Analysis of the kinetics of DNA-DSB repair in wild-type and mutant plants by single-nucleus agarose gel electrophoresis revealed that bleomycin-induced fragmentation of genomic DNA was repaired at approximately equal rates in each genotype, although both the Ppmre11 and Pprad50 mutants exhibited severely restricted growth and development and enhanced sensitivity to UV-B and bleomycin-induced DNA damage, compared with wild-type and Ppnbs1 plants. This implies that while extensive DNA repair can occur in the absence of a functional MRN complex; this is unsupervised in nature and results in the accumulation of deleterious mutations incompatible with normal growth and development.