Expression of p73, a p53 family member regulating cell growth and apoptosis, is maintained at low levels in mammalian cells, and cellular activation of p73 is usually controlled at the protein level. However, the precise molecular mechanisms by which p73 stability is regulated are unclear. During the search for interacting molecules with the COOH-terminal proline-rich region of p73, we identified a novel NEDD4-related protein (termed as NEDL2) which contains a C2 domain at its NH(2)-terminus, two WW domains, and a HECT domain at its COOH-terminus. As expected, NEDL2 catalyzed the ubiquitination of bacterial cellular proteins in vitro. Reciprocal co-immunoprecipitation experiments and in vitro pull-down assays revealed that NEDL2 bound to p73, which carries two putative PY motifs. p73 was efficiently ubiquitinated but stabilized in a NEDL2-dependent manner. Accordingly, p73 decayed at faster rates in the absence of NEDL2 than in its presence. Consistent with the NEDL2-mediated stabilization of p73, NEDL2 enhanced the p73-dependent transcriptional activation. Thus, our results suggest that NEDL2 activates the function of p73 by increasing its stability.