In eukaryotic DNA replication, DNA polymerase ε (Polε) is responsible for leading strand synthesis, while DNA polymerases α and δ synthesize the lagging strand. The human Polε (hPolε) holoenzyme is comprised of the catalytic p261 subunit and the non-catalytic p59, p17, and p12 small subunits. So far, the contribution of the non-catalytic subunits to hPolε function is not well understood. Using pre-steady-state kinetic methods, we established a minimal kinetic mechanism for DNA polymerization and editing catalyzed by the hPolε holoenzyme. Compared to the 140-kDa N-terminal catalytic fragment of p261 (p261N) which we kinetically characterized in our earlier studies, the presence of the p261 C-terminal domain (p261C) and the three small subunits increased the DNA binding affinity and the base substitution fidelity. Although the small subunits enhanced correct nucleotide incorporation efficiency, there was a wide range of rate constants when incorporating a correct nucleotide over a single-base mismatch. Surprisingly, the 3′→5′ exonuclease activity of the hPolε holoenzyme was significantly slower than that of p261N when editing both matched and mismatched DNA substrates. This suggests that the presence of p261C and the three small subunits regulates the 3′→5′ exonuclease activity of hPolε holoenzyme. Together, the 3′→5′ exonuclease activity and the variable mismatch extension activity modulate the overall fidelity of the hPolε holoenzyme by up to three orders of magnitude. Thus, the presence of p261C and the three non-catalytic subunits optimizes the dual enzymatic activities of the catalytic p261 subunit and makes the hPolε holoenzyme an efficient and faithful replicative DNA polymerase.