Transcription activator-like effector nucleases are readily targetable 'molecular scissors' for genome engineering applications. These artificial nucleases offer high specificity coupled with simplicity in design that results from the ability to serially chain transcription activator-like effector repeat arrays to target individual DNA bases. However, these benefits come at the cost of an appreciably large multimeric protein complex, in which DNA cleavage is governed by the nonspecific FokI nuclease domain. Here we report a significant improvement to the standard transcription activator-like effector nuclease architecture by leveraging the partially specific I-TevI catalytic domain to create a new class of monomeric, DNA-cleaving enzymes. In vivo yeast, plant and mammalian cell assays demonstrate that the half-size, single-polypeptide compact transcription activator-like effector nucleases exhibit overall activity and specificity comparable to currently available designer nucleases. In addition, we harness the catalytic mechanism of I-TevI to generate novel compact transcription activator-like effector nuclease-based nicking enzymes that display a greater than 25-fold increase in relative targeted gene correction efficacy.