Deamination of cytosine (C), 5-methylcytosine (mC) and 5-hydroxymethylcytosine (hmC) occurs spontaneously in mammalian DNA with several hundred deaminations occurring in each cell every day. The resulting potentially mutagenic mispairs of uracil (U), thymine (T) or 5-hydroxymethyluracil (hmU) with guanine (G) are substrates for repair by various DNA glycosylases. Here, we show that targeted inactivation of the mouse Smug1 DNA glycosylase gene is sufficient to ablate nearly all hmU-DNA excision activity as judged by assay of tissue extracts from knockout mice as well as by the resistance of their embryo fibroblasts to 5-hydroxymethyldeoxyuridine toxicity. Inactivation of Smug1 when combined with inactivation of the Ung uracil-DNA glycosylase gene leads to a loss of nearly all detectable uracil excision activity. Thus, SMUG1 is the dominant glycosylase responsible for hmU-excision in mice as well as the major UNG-backup for U-excision. Both Smug1-knockout and Smug1/Ung-double knockout mice breed normally and remain apparently healthy beyond 1 year of age. However, combined deficiency in SMUG1 and UNG exacerbates the cancer predisposition of Msh2(-/-) mice suggesting that when both base excision and mismatch repair pathways are defective, the mutagenic effects of spontaneous cytosine deamination are sufficient to increase cancer incidence but do not preclude mouse development.