The Skp2 oncoprotein belongs to the family of F-box proteins that function as substrate recognition factors for SCF (Skp1, cullin, F-box protein) E3 ubiquitin-ligase complexes. Binding of the substrate to the SCFSkp2 complex catalyzes the conjugation of ubiquitin molecules to the bound substrate, resulting in multi-ubiquitination and rapid degradation by the 26 S proteasome. Using Skp2 as bait in a yeast two-hybrid screen, we have identified UBP43 as a novel substrate for Skp2. UBP43 belongs to the family of ubiquitin isopeptidases and specifically cleaves ISG15, a ubiquitin-like molecule that is induced by cellular stresses, such as type 1 interferons (IFN), nephrotoxic damage, and bacterial infection. UBP43 was originally identified as an up-regulated gene in knock-in mice expressing an acute myelogenous leukemia fusion protein, AML1-ETO, as well as in melanoma cell lines treated with IFN-β. The phenotype of UBP43 knockout mice includes shortened life span, hypersensitivity to IFN, and neuronal damage, suggesting that tight regulation of ISG15 conjugation is critical for normal cellular function. In this study, we demonstrate that UBP43 is ubiquitinated in vivo and accumulates in cells treated with proteasome inhibitors. We also show that Skp2 promotes UBP43 ubiquitination and degradation, resulting in higher levels of ISG15 conjugates. In Skp2-/- mouse cells, levels of UBP43 are consistently up-regulated, whereas levels of ISG15 conjugates are reduced. Our results demonstrate that the SCFSkp2 is involved in controlling UBP43 protein levels and may therefore play an important role in modulating type 1 IFN signaling.