Template switching (TS) mediates damage-bypass via a recombination-related mechanism involving PCNA polyubiquitylation and Polymerase δ-dependent DNA synthesis. Using two-dimensional gel electrophoresis and electron microscopy, here we characterize TS intermediates arising in Saccharomyces cerevisiae at a defined chromosome locus, identifying five major families of intermediates. Single-stranded DNA gaps in the range of 150-200 nucleotides, and not DNA ends, initiate TS by strand invasion. This causes re-annealing of the parental strands and exposure of the non-damaged newly synthesized chromatid as template for replication by the other blocked nascent strand. Structures resembling double Holliday Junctions, postulated to be central double-strand break repair intermediates, but so far only visualized in meiosis, mediate late stages of TS, before being processed to hemicatenanes. Our results reveal the DNA transitions accounting for recombination-mediated DNA damage tolerance in mitotic cells and for replication under conditions of genotoxic stress.