Perturbations in neuronal protein homeostasis likely contribute to disease pathogenesis in polyglutamine (polyQ) neurodegenerative disorders. Here we provide evidence that the co-chaperone and ubiquitin ligase, CHIP (C-terminus of Hsp70-interacting protein), is a central component to the homeostatic mechanisms countering toxic polyQ proteins in the brain. Genetic reduction or elimination of CHIP accelerates disease in transgenic mice expressing polyQ-expanded ataxin-3, the disease protein in Spinocerebellar Ataxia Type 3 (SCA3). In parallel, CHIP reduction markedly increases the level of ataxin-3 microaggregates, which partition in the soluble fraction of brain lysates yet are resistant to dissociation with denaturing detergent, and which precede the appearance of inclusions. The level of microaggregates in the CNS, but not of ataxin-3 monomer, correlates with disease severity. Additional cell-based studies suggest that either of two quality control ubiquitin ligases, CHIP or E4B, can reduce steady state levels of expanded, but not wild-type, ataxin-3. Our results support an aggregation model of polyQ disease pathogenesis in which ataxin-3 microaggregates are a neurotoxic species, and suggest that enhancing CHIP activity is a possible route to therapy for SCA3 and other polyQ diseases.