The initiation of DNA replication requires two protein kinases: cyclin-dependent kinase (Cdk) and Cdc7. Although S phase Cdk activity has been intensively studied, relatively little is known about how Cdc7 regulates progression through S phase. We have used a Cdc7 inhibitor, PHA-767491, to dissect the role of Cdc7 in Xenopus egg extracts. We show that hyperphosphorylation of mini-chromosome maintenance (MCM) proteins by Cdc7 is required for the initiation, but not for the elongation, of replication forks. Unlike Cdks, we demonstrate that Cdc7 executes its essential functions by phosphorylating MCM proteins at virtually all replication origins early in S phase and is not limiting for progression through the Xenopus replication timing programme. We demonstrate that protein phosphatase 1 (PP1) is recruited to chromatin and rapidly reverses Cdc7-mediated MCM hyperphosphorylation. Checkpoint kinases induced by DNA damage or replication inhibition promote the association of PP1 with chromatin and increase the rate of MCM dephosphorylation, thereby counteracting the previously completed Cdc7 functions and inhibiting replication initiation. This novel mechanism for regulating Cdc7 function provides an explanation for previous contradictory results concerning the control of Cdc7 by checkpoint kinases and has implications for the use of Cdc7 inhibitors as anti-cancer agents.