As DNA repair plays an important role in genetic susceptibility to bladder cancer, assessment of the DNA repair phenotype is critical for the molecular epidemiology of bladder cancer. In this study, we developed and applied an assay using the luciferase (luc) reporter gene in a host-cell reactivation assay to measure DNA repair capacity for DNA damage induced by 4-aminobiphenyl (4-ABP), a well-studied aromatic amine and a known bladder carcinogen. We observed a dose-response relationship for 4-ABP dosage and DNA repair capacity (luc activity). We then applied this assay to measure DNA repair capacity in a pilot study of 89 pairs of bladder cancer patients and healthy controls matched by age, gender, and ethnicity, and we found that DNA repair capacity was significantly lower in cases than in controls (13.0% versus 14.4%; P = 0.006). Poor DNA repair capacity was associated with 3.42-fold increased bladder cancer risk. Further analysis revealed that intermediate and low levels of DNA repair capacity increased bladder cancer risk to 3.43-fold and 4.97-fold, respectively, compared with individuals with the most efficient DNA repair capacity. Moreover, ever smokers with suboptimal DNA repair capacity exhibited a 6.06-fold increased risk compared with never smokers with normal DNA repair capacity. In conclusion, our results support the hypothesis that deficient DNA repair capacity for 4-ABP induced DNA damage and increases bladder cancer risk. Our assay provides a new tool to specifically quantify DNA repair capacity in bladder cancer studies and, therefore, contributes to our goal of further elucidating bladder carcinogenesis.