Nedd8 is a ubiquitin-like modifier that is attached to the cullin components of E3 ubiquitin ligases. More recently, p53 has also been shown to be Nedd8-modified. Nedd8 attachment occurs in a manner similar to that observed for other ubiquitin-like modifiers. In the present study, we report on the characterization of Nep1, a deneddylating enzyme in fission yeast (Schizosaccharomyces pombe). Unlike loss of ned8, deletion of the nep1 gene is not lethal, although nep1.d cells are heterogeneous in length, suggesting a defect in cell-cycle progression. Viability of nep1.d cells is dependent on a functional spindle checkpoint but not on the DNA integrity checkpoint. Deletion of a related gene (nep2), either alone or in combination with nep1.d, also has little effect on cell viability. We show that Nep1 can deneddylate the Pcu1, Pcu3 and Pcu4 cullins in vitro and that its activity is sensitive to N-ethylmaleimide, consistent with the idea that it is a member of the cysteine protease family. nep1.d cells accumulate Nedd8-modified proteins, although these do not correspond to modified forms of the cullins, suggesting that, although Nep1 can deneddylate cullins in vitro, this is not its main function in vivo. Nep1 can be co-precipitated with the signalosome subunit Csn5. Nep1 itself is present in a high-molecular-mass complex, but the presence of this complex is not dependent on the production of intact signalosomes. Our results suggest that, in vivo, Nep1 may be responsible for deneddylating proteins other than cullins.