The Hace1-HECT E3 ligase is a tumor suppressor that ubiquitylates the activated GTP-bound form of the Rho family GTPase Rac1, leading to Rac1 proteasomal degradation. Here we show that, in vertebrates, Hace1 targets Rac1 for degradation when Rac1 is localized to the nicotinamide adenine dinucleotide phosphate (NADPH) oxidase holoenzyme. This event blocks de novo reactive oxygen species generation by Rac1-dependent NADPH oxidases, and thereby confers cellular protection from reactive oxygen species-induced DNA damage and cyclin D1-driven hyper-proliferation. Genetic inactivation of Hace1 in mice or zebrafish, as well as Hace1 loss in human tumor cell lines or primary murine or human tumors, leads to chronic NADPH oxidase-dependent reactive oxygen species elevation, DNA damage responses and enhanced cyclin D1 expression. Our data reveal a conserved ubiquitin-dependent molecular mechanism that controls the activity of Rac1-dependent NADPH oxidase complexes, and thus constitutes the first known example of a tumor suppressor protein that directly regulates reactive oxygen species production in vertebrates.