In the ubiquitin system, a target substrate is modified by ubiquitin or a ubiquitin-like protein. This modification remodels the surface of the target proteins, affecting, among other properties, their stability, interactions with other proteins, activity, and subcellular localization. At least 10 different modifiers have been described in mammalian cells and conjugation of each modifier to its target may result in a different biological effect. In many cases proteins are modified by multiple moieties of ubiquitin that generate a branched polyubiquitin chain. For most proteins, this modification leads to their degradation by the 26S proteasome. Yet, dependent on the character of the internal linkage between the ubiquitin moieties, it can also lead to activation of transcriptional regulators. Modification by a single moiety of ubiquitin can target proteins for degradation in the lysosome/vacuole. Conjugation of ubiquitin or ubiquitin-like proteins can serve a variety of non-proteolytic functions, such as activation of enzymes, modulation of membrane dynamics, or routing of the tagged proteins to their sub-cellular destination. Ubiquitination of cellular proteins is a highly complex, temporally controlled, and tightly regulated process that targets, in a specific manner, thousands of cellular proteins. It is carried out by a modular cascade of enzymes with high specificity towards defined structural motifs in the target proteins. It has emerged as a critically important post-translational modification that plays major roles in regulating a broad array of basic cellular processes, such as cell division, differentiation, signal transduction, trafficking, and quality control. Not surprisingly, aberrations in the system have been implicated in the pathogenesis of many diseases, certain malignancies, neurodegenerative disorders and pathologies of the inflammatory and immune response among them. Understanding of the underlying mechanisms involved is important for the development of novel, mechanism-based drugs.