The phenomenon of damage tolerance, whereby cells incur DNA lesions that are nonlethal, largely ignored, but highly mutagenic, appears to play a key role in carcinogenesis. Typically, these lesions are generated by alkylation of DNA or incorporation of base analogues. This tolerance is usually a result of the loss of specific DNA repair processes, most often DNA mismatch repair (MMR). The availability of genetically matched MMR-deficient and -corrected cell systems allows dissection of the consequences of this unrepaired damage in carcinogenesis as well as the elucidation of cell cycle checkpoint responses and cell death consequences. Recent data indicate that MMR plays an important role in detecting damage caused by fluorinated pyrimidines (FPs) and represents a repair system that is probably not the primary system for detecting damage caused by these agents, but may be an important system for correcting key mutagenic lesions that could initiate carcinogenesis. In fact, clinical studies have shown that there is no benefit of FP-based adjuvant chemotherapy in colon cancer patients exhibiting microsatellite instability, a hallmark of MMR deficiency. MMR-mediated damage tolerance and futile cycle repair processes are discussed, as well as possible strategies using FPs to exploit these systems for improved anticancer therapy.