Human Exo1 is a member of the RAD2 nuclease family with roles in replication, repair and recombination. Despite sharing significant amino acid sequence homology, the RAD2 proteins exhibit disparate nuclease properties and biological functions. In order to identify elements that dictate substrate selectivity within the RAD2 family, we sought to identify residues key to Exo1 nuclease activity and to characterize the molecular details of the human Exo1-DNA interaction. Site-specific mutagenesis studies demonstrate that amino acids D78, D173 and D225 are critical for Exo1 nuclease function. In addition, we show that the chemical nature of the 5'-terminus has a major impact on Exo1 nuclease efficiency, with a 5'-phosphate group stimulating degradation 10-fold and a 5'-biotin inhibiting degradation 10-fold (relative to a 5'-hydroxyl moiety). An abasic lesion located within a substrate DNA strand impedes Exo1 nucleolytic degradation, and a 5'-terminal abasic residue reduces nuclease efficiency 2-fold. Hydroxyl radical footprinting indicates that Exo1 binds predominantly along the minor groove of flap DNA, downstream of the junction. As will be discussed, our results favor the notion that the single-stranded DNA structure is pinched by the helical arch of the protein and not threaded through this key recognition loop. Furthermore, our studies indicate that significant, presumably biologically relevant, differences exist between the active site dynamics of Exo1 and Fen1.