Radiotherapy of thyroid cancer with I-131 is abrogated by inherent loss of radioiodine uptake due to loss of sodium iodide symporter (NIS) expression in poorly differentiated tumor cells. It is also known that ionizing radiation per se down-regulates NIS (the stunning effect), but the mechanism is unknown. Here we investigated whether loss of NIS-mediated iodide transport may be elicited by DNA damage. Calicheamicin, a fungal toxin that specifically cleaves double-stranded DNA, induced a full scale DNA damage response mediated by the ataxia-telangiectasia mutated (ATM) kinase in quiescent normal thyrocytes. At sublethal concentrations (<1 nM) calicheamicin blocked NIS mRNA expression and transepithelial iodide transport as stimulated by thyrotropin; loss of function occurred at a much faster rate than after I-131 irradiation. KU-55933, a selective ATM kinase inhibitor, partly rescued NIS expression and iodide transport in DNA-damaged cells. Prolonged ATM inhibition in healthy cells also repressed NIS-mediated iodide transport. ATM-dependent loss of iodide transport was counteracted by IGF-1. Together, these findings indicate that NIS, the major iodide transporter of the thyroid gland, is susceptible to DNA damage involving ATM-mediated mechanisms. This uncovers novel means of poor radioiodine uptake in thyroid cells subjected to extrinsic or intrinsic genotoxic stress.