Activation of the Fanconi anemia (FA) pathway after treatment with mitomycin C (MMC) is essential for preventing chromosome translocations termed "radials." When replication forks stall at MMC-induced interstrand crosslinks (ICLs), the FA pathway is activated to orchestrate ICL unhooking and repair of the DNA break intermediates. However, in FA-deficient cells, how ICL-associated breaks are resolved in a manner that leads to radials is unclear. Here, we demonstrate that MMC-induced radials are dependent on DNA polymerase theta (POLθ)-mediated alternative end joining (A-EJ). Specifically, we show that radials observed in FANCD2-/- cells are dependent on POLθ and DNA ligase III and occur independently of classical non-homologous end joining. Furthermore, treatment of FANCD2-/- cells with POLθ inhibitors abolishes radials and leads to the accumulation of breaks co-localizing with common fragile sites. Uniformly, these observations implicate A-EJ in radial formation and provide mechanistic insights into the treatment of FA pathway-deficient cancers with POLθ inhibitors.