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Noncoding mutation hotspots have been identified in melanoma and many of them occur at the binding sites of E26 transformation-specific (ETS) proteins; however, their formation mechanism and functional impacts are not fully understood. Here, we used UV (Ultraviolet) damage sequencing data and analyzed cyclobutane pyrimidine dimer (CPD) formation, DNA repair, and CPD deamination in human cells at single-nucleotide resolution. Our data show prominent CPD hotspots immediately after UV irradiation at ETS binding sites, particularly at sites with a conserved TTCCGG motif, which correlate with mutation hotspots identified in cutaneous melanoma. Additionally, CPDs are repaired slower at ETS binding sites than in flanking DNA. Cytosine deamination in CPDs to uracil is suggested as an important step for UV mutagenesis. However, we found that CPD deamination is significantly suppressed at ETS binding sites, particularly for the CPD hotspot on the 5′ side of the ETS motif, arguing against a role for CPD deamination in promoting ETS-associated UV mutations. Finally, we analyzed a subset of frequently mutated promoters, including the ribosomal protein genesRPL13AandRPS20, and found that mutations in the ETS motif can significantly reduce the promoter activity. Thus, our data identify high UV damage and low repair, but not CPD deamination, as the main mechanism for ETS-associated mutations in melanoma and uncover important roles of often-overlooked mutation hotspots in perturbing gene transcription.