The serum and glucocorticoid-induced protein kinase gene (sgk-1) encodes a multifunctional kinase that can be phosphorylated and activated through a phosphatidylinositol 3-kinase-dependent signaling pathway. In many cell types, endogenous SGK-1 steady-state protein levels are very low but can be acutely up-regulated after glucocorticoid receptor-mediated transcriptional activation; in breast epithelial and cancer cell lines, this up-regulation is associated with promotion of cell survival. We and others have noted that ectopically introduced full-length SGK-1 is poorly expressed, although SGK-1 lacking the first 60 amino acids (delta60SGK-1) is expressed at much higher-fold protein levels than wild-type SGK-1 in both human embryonic kidney 293T and MCF10A mammary epithelial cells. In this report, we demonstrate for the first time that the low steady-state expression level of SGK-1 is due to polyubiquitination and subsequent degradation by the 26S proteasome. Deletion of the amino-terminal 60 amino acids of SGK-1 results in a mutant SGK-1 protein that is neither efficiently polyubiquitinated nor degraded by the 26S proteasome, accounting for the higher steady-state levels of the truncated protein. We also demonstrate that a subset of SGK-1 localizes to the plasma membrane and that the polyubiquitin-modified SGK-1 localizes to a membrane-associated fraction of the cell. Taken together, these data suggest that a significant fraction of SGK-1 is membrane-associated and ubiquitinated. These findings are consistent with the recently described role of SGK-1 in phosphorylating the membrane-associated protein Nedd4-2 and the integral membrane Na+/H+ exchanger isoform 3 (NHE3) and suggest a novel mechanism of regulation of SGK-1.