The gene encoding DNA polymerase θ (Polθ) was discovered over ten years ago as having a role in suppressing genome instability in mammalian cells. Studies have now clearly documented an essential function for this unique A-family polymerase in the double-strand break (DSB) repair pathway alternative end-joining (alt-EJ), also known as microhomology-mediated end-joining (MMEJ), in metazoans. Biochemical and cellular studies show that Polθ exhibits a unique ability to perform alt-EJ and during this process the polymerase generates insertion mutations due to its robust terminal transferase activity which involves template-dependent and independent modes of DNA synthesis. Intriguingly, the POLQ gene also encodes for a conserved superfamily 2 Hel308-type ATP-dependent helicase domain which likely assists in alt-EJ and was reported to suppress homologous recombination (HR) via its anti-recombinase activity. Here, we review our current knowledge of Polθ-mediated end-joining, the specific activities of the polymerase and helicase domains, and put into perspective how this multifunctional enzyme promotes alt-EJ repair of DSBs formed during S and G2 cell cycle phases.