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Despite the great advances in discovering cyclic peptides against protein targets, their reduced aqueous solubility, cell permeability, and activity of the cyclic peptide restrict its utilization in advanced biological research and therapeutic applications. Here we report on a novel approach of structural alternation of the exocyclic and linker parts that led to a new derivative with significantly improved cell activity allowing us to dissect its mode of action in detail. We have identified an effective cyclic peptide (CP7) that induces approximately a 9‐fold increase in DNA damage accumulation and a remarkable increase in apoptotic cancer cell death compared to the reported molecule. Notably, treating cells with CP7 leads to a dramatic decrease in the efficiency of non‐homologous end joining (NHEJ) repair of DNA double‐strand breaks (DSBs), which is accompanied by an increase in homologous recombination (HR) repair. Interestingly, treating BRCA1‐deficient cells with CP7 restores HR integrity, which is accompanied by increased resistance to CP7. Additionally, CP7 treatment increases the sensitivity of cancer cells to ionizing radiation. Collectively, our findings demonstrate that CP7 is a selective inhibitor of NHEJ, offering a potential strategy to enhance the effectiveness of radiation therapy. [ABSTRACT FROM AUTHOR]