Abstract The structural maintenance of chromosome (SMC) complex cohesin mediates sister chromatid cohesion established during replication, and damage-induced cohesion formed in response to DSBs post-replication. The translesion synthesis polymerase Polη is required for damage-induced cohesion through a hitherto unknown mechanism. Since Polη is functionally associated with transcription, and transcription triggers de novo cohesion in Schizosaccharomyces pombe , we hypothesized that transcription facilitates damage-induced cohesion in Saccharomyces cerevisiae . Here, we show dysregulated transcriptional profiles in Polη-depleted cells ( rad30Δ ), where genes involved in chromatin assembly and positive transcription regulation were downregulated. In addition, chromatin association of RNA polymerase II was reduced at promoters and coding regions in rad30Δ compared to WT cells, while occupancy of the H2A.Z variant (Htz1) at promoters was increased in rad30Δ cells. Perturbing histone exchange at promoters inactivated damage-induced cohesion, similarly to deletion of the RAD30 gene. Conversely, altering regulation of transcription elongation suppressed the deficient damage-induced cohesion in rad30Δ cells. These results indicate that Polη has an assisting role during the transcriptional process, which consecutively facilitates formation of damage-induced cohesion. This further suggests a potential linkage between regulation of transcription and formation of damage-induced cohesion after replication. Author Summary The cohesin complex dynamically associates with chromosomes and holds sister chromatids together through cohesion established during replication. This ensures faithful chromosome segregation at anaphase. In budding yeast, DNA double strand breaks trigger sister chromatid cohesion even after replication. This so-called damage-induced cohesion is formed both close to the breaks, and genome-wide on undamaged chromosomes. The translesion synthesis polymerase eta (Polη) is specifically required for genome wide damage-induced cohesion. Although Polη is well characterized for its function in bypassing ultraviolet-induced DNA lesions, its mechanistic role in damage-induced cohesion is unclear. Here, we show that transcriptional regulation is perturbed in the absence of Polη. We propose that Polη could aid in chromatin association of RNA polymerase II through phosphorylation of the Polη-S14 residue, a non-canonical role of Polη which further facilitates formation of damage-induced cohesion genome wide. In addition, we observe the need of replication-independent nucleosome assembly/histone exchange for formation of damage-induced cohesion. This together provides new insight into formation of damage-induced cohesion after replication, which will be interesting to further explore.