Recombination between repeated DNA sequences can have drastic consequences on the integrity of the genome. Repeated sequences are abundant in most eukaryotes, yet the mechanism that prevents recombination between them is currently unknown. Ty elements, the main family of dispersed repeats in Saccharomyces cerevisiae, exhibit low levels of exchange. Other regions in the genome have relatively high rates of meiotic recombination (hotspots). We show that a Ty element adjacent to the HIS4 recombination hotspot substantially reduces its activity, eliminating local DSB formation. We demonstrate that the Ty has a closed (nuclease-insensitive) chromatin configuration that is also imposed on the flanking DNA sequences. The compact chromatin structure is determined by sequences at the N terminus of the Ty. Increased binding of the Rap1 protein to the hotspot restores both open chromatin conformation and DSB formation. The chromatin configuration of Ty elements precludes initiation of recombination, thus preventing potentially lethal exchanges between repeated sequences.