DNA double-strand breaks (DSBs) must be properly repaired within diverse chromatin domains to maintain genome stability. Whereas euchromatin has an open structure and is associated with transcription, facultative heterochromatin is essential to silence developmental genes and forms compact nuclear condensates, called polycomb bodies. Whether the specific chromatin properties of facultative heterochromatin require distinct DSB repair mechanisms remains unknown. Here, we integrate single DSB systems in euchromatin and facultative heterochromatin in Drosophila melanogaster and find that heterochromatic DSBs rapidly move outside polycomb bodies. These DSB movements coincide with a break-proximal reduction in the canonical heterochromatin mark histone H3 Lysine 27 trimethylation (H3K27me3). We demonstrate that DSB movement and loss of H3K27me3 at heterochromatic DSBs depend on the histone demethylase dUtx. Moreover, loss of dUtx specifically disrupts completion of homologous recombination at heterochromatic DSBs. We conclude that DSBs in facultative heterochromatin require dUtx-mediated loss of H3K27me3 to promote DSB movement and repair.