In silico genome sequence analyses suggested that mycobacteria are devoid of the highly conserved mutLS-based post-replicative mismatch repair system. Here, we present the first biological evidence for the lack of a classical mismatch repair function in mycobacteria. We found that frameshifts, but not general mutation rates are unusually high in Mycobacterium smegmatis. However, despite the absence of mismatch correction, M. smegmatis establishes a strong barrier to recombination between homeologous DNA sequences. We show that 10-12% of DNA sequence heterology restricts initiation of recombination but not extension of heteroduplex DNA intermediates. Together, the lack of mismatch correction and a high stringency of initiation of homologous recombination provide an adequate strategy for mycobacterial genome evolution, which occurs by gene duplication and divergent evolution.