Phospholipase D (PLD) is an important lipase in many cellular processes, including vesicular trafficking, cell survival, and cell migration. In the present study, we show that PLD1, but not PLD2, is posttranslationally modified by multi-monoubiquitination. Intriguingly, suppression of lipase activity either by mutation of the HKD motif (PLD1 H896R, K898R, or D903A) or the phosphatidylinositol 4,5-bisphosphate binding motif (PLD1 R691G,R695G) or through use of PLD-selective inhibitors impaired the ubiquitination of PLD1, although stimulation of lipase activity by phorbol 12-myristate 13-acetate did not enhance its ubiquitination. A palmitoylation-deficient mutant PLD1 allele, which exhibits altered patterns of vesicular trafficking, had significantly lower levels of monoubiquitination. In addition, the expression of ubiquitin-fused PLD1 induced aberrantly enlarged vesicles partially co-localized with the Golgi complex but not with early endosomes. The altered localization was reduced by the K898R mutation, suggesting a role of multi-monoubiquitination in PLD1 subcellular localization. Surprisingly, the degradation of PLD1, but not of PLD1 K898R or PLD2, was blocked by inhibitors of proteasomes but not by inhibitors of lysosomes or other proteases, suggesting a role of the ubiquitination in proteasomal degradation of PLD1. In summary, our studies show that PLD1, but not PLD2, is multi-monoubiquitinated. The ubiquitination modification might represent a novel regulatory mechanism in PLD1 functioning, particularly in the context of subcellular trafficking between different membrane compartments.