Protein modification by the ubiquitin-like SUMO protein contributes to many cellular regulatory mechanisms. In Saccharomyces cerevisiae, both sumoylating and desumoylating activities are essential for viability. Of its two known desumoylating enzymes, Ubl-specific protease (Ulp)1 and Ulp2/Smt4, Ulp1 is specifically required for cell cycle progression. A ∼200-residue segment, the Ulp domain (UD), is conserved among Ulps and includes a core cysteine protease domain that is even more widespread. Here we demonstrate that the Ulp1 UD by itself can support wild-type growth rates and in vitro can cleave SUMO from substrates. However, in cells expressing only the UD of Ulp1, many SUMO conjugates accumulate to high levels, indicating that the nonessential Ulp1 NH2-terminal domain is important for activity against a substantial fraction of sumoylated targets. The NH2-terminal domain also includes sequences necessary and sufficient to concentrate Ulp1 at nuclear envelope sites. Remarkably, NH2-terminally deleted Ulp1 variants are able, unlike full-length Ulp1, to suppress defects of cells lacking the divergent Ulp2 isopeptidase. Thus, the NH2-terminal regulatory domain of Ulp1 restricts Ulp1 activity toward certain sumoylated proteins while enabling the cleavage of others. These data define key functional elements of Ulp1 and strongly suggest that subcellular localization is a physiologically significant constraint on SUMO isopeptidase specificity.
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