Chromosomal rearrangements, including translocations, require formation and joining of DNA double strand breaks (DSBs). These events disrupt the integrity of the genome and are frequently involved in producing leukemias, lymphomas and sarcomas. Despite the importance of these events, current understanding of their genesis is limited. To examine the origins of chromosomal rearrangements we developed Translocation Capture Sequencing (TC-Seq), a method to document chromosomal rearrangements genome-wide, in primary cells. We examined over 180,000 rearrangements obtained from 400 million B lymphocytes, revealing that proximity between DSBs, transcriptional activity and chromosome territories are key determinants of genome rearrangement. Specifically, rearrangements tend to occur in cis and to transcribed genes. Finally, we find that activation-induced cytidine deaminase (AID) induces the rearrangement of many genes found as translocation partners in mature B cell lymphoma.