DNA interstrand crosslinks (ICLs) are toxic DNA lesions whose repair occurs in the S phase of metazoans via an unknown mechanism. Here, we describe a cell-free system based on Xenopus egg extracts that supports ICL repair. During DNA replication of a plasmid containing a site-specific ICL, two replication forks converge on the crosslink. Subsequent lesion bypass involves advance of a nascent leading strand to within one nucleotide of the ICL, followed by incisions, translesion DNA synthesis, and extension of the nascent strand beyond the lesion. Immunodepletion experiments suggest that extension requires DNA polymerase zeta. Ultimately, a significant portion of the input DNA is fully repaired, but not if DNA replication is blocked. Our experiments establish a mechanism for ICL repair that reveals how this process is coupled to DNA replication.