Analysis of the in vivo ubiquitylation of the p54/Rpn10 polyubiquitin receptor subunit of the Drosophila 26S proteasome revealed that the site of ubiquitylation is the C-terminal cluster of lysines, which is conserved in higher eukaryotes. Extraproteasomal p54 was extensively multiubiquitylated, but only very modest modification was detected in the proteasome-assembled subunit. Ubiquitylation of p54 seriously jeopardizes one of its most important functions, i.e., the interaction of its ubiquitin-interacting motifs with the ubiquitin-like domain of Dsk2 and Rad23 extraproteasomal polyubiquitin receptors. This modification of p54 supports the previous notion that p54 is a shuttling subunit of the 26S proteasome with a specific extraproteasomal function. This assumption is supported by the observation that, while transgenic p54 can fully rescue the lethal phenotype of the Δp54 null mutation, its derivative from which the cluster of conserved lysines is deleted shifts the lethality from the early pupa to pharate adult stage but cannot rescue the Δp54 mutation, suggesting that ubiquitylated extraproteasomal p54 has an essential role in the pupa-adult transition.