The function of PTEN in the cytoplasm largely depends on its lipid-phosphatase activity, though which it antagonizes the PI3K–AKT oncogenic pathway. However, molecular mechanisms underlying the role of PTEN in the nucleus remain largely elusive. Here, we report that DNA double-strand breaks (DSB) promote PTEN interaction with MDC1 upon ATM-dependent phosphorylation of T/S398-PTEN. Importantly, DNA DSBs enhance NSD2 (MMSET/WHSC1)-mediated dimethylation of PTEN at K349, which is recognized by the tudor domain of 53BP1 to recruit PTEN to DNA-damage sites, governing efficient repair of DSBs partly through dephosphorylation of γH2AX. Of note, inhibiting NSD2-mediated methylation of PTEN, either through expressing methylation-deficient PTEN mutants or through inhibiting NSD2, sensitizes cancer cells to combinatorial treatment with a PI3K inhibitor and DNA-damaging agents in both cell culture and in vivo xenograft models. Therefore, our study provides a novel molecular mechanism for PTEN regulation of DSB repair in a methylation- and protein phosphatase–dependent manner.