The synthesis of mitochondrial DNA (mtDNA) is a complex process that involves the formation and resolution of unusual nucleic acid structures, such as RNA:DNA hybrids. However, little is known about the enzymes that regulate these processes. RECQ4 is a DNA replication factor important for mtDNA maintenance, and here, we unveil a role of human RECQ4 in regulating the formation and resolution of mitochondrial RNA:DNA hybrids. Mitochondrial membrane protein p32 can block mtDNA synthesis by restricting RECQ4 mitochondrial localization via protein–protein interaction. We found that the interaction with p32 was disrupted not only by the previously reported cancer-associated RECQ4 mutation, del(A420-A463), but also by a clinical mutation of the adjacent residue, P466L. Surprisingly, although P466L mutant was present in the mitochondria at greater levels, unlike del(A420-A463) mutant, it failed to enhance mtDNA synthesis due to the accumulation of RNA:DNA hybrids throughout the mtDNA. Biochemical analysis revealed that P466L mutation enhanced RECQ4 annealing activity to generate RNA:DNA hybrids at the same time reduced its unwinding activity to resolve this structure. Hence, P466L mutation led to a reduced efficiency in completing mtDNA synthesis due to unresolved RNA:DNA hybrids across mtDNA.