This review addresses a variety of mechanisms by which DNA repair interacts with transcription and vice versa. Blocking of transcriptional elongation is the best studied of these mechanisms. Transcription recovery after damage therefore has often been used as a surrogate marker of DNA repair in cells. However, it has become evident that relationships between DNA damage, repair, and transcription are more complex due to various indirect effects of DNA damage on gene transcription. These include inhibition of transcription by DNA repair intermediates as well as regulation of transcription and of the epigenetic status of the genes by DNA repair-related mechanisms. In addition, since transcription is emerging as an important endogenous source of DNA damage in cells, we briefly summarise recent advances in understanding the nature of co-transcriptionally induced DNA damage and the DNA repair pathways involved.