Nicotinamide (NA), a relatively nontoxic compound, has been shown to inhibit tumor development, induce differentiation, increase the sensitization of the anticancer drug resistant cancer cells and is being used in different skin ailments. But there are not many reports on its mechanism of action. Here we report that NA induced endonuclease activity. This endonuclease induction by NA appeared to be dose dependent and a function of time. As evident by the use of modifiers of DNase I, this endonuclease appeared to be like DNase type I. Increased [3H] thymidine incorporation in DNA in the presence of NA is possibly a consequence of increased 3-OH'nicks due to increased DNA fragmentation by increased endonuclease activity. The present results would be of help in the better understanding of the mechanism of NA action and its improved use in cancer control.