The osmolarity of body fluid is strictly controlled through the action of diuretic hormones, which are secreted in the hypothalamus. In the mammalian brain, ubiquitin-like 5 (UBL5) is expressed in oxytocin- and vasopressin-positive neurons in the hypothalamus, and these neurons play a role in regulating osmolarity. We examined the dynamics of UBL5 levels in response to hyper- or hypo-osmotic conditions. Hypo-osmotic conditions led to significantly reduced levels of UBL5 both in brain slices from the hypothalamus and in NIH-3T3 cells. This decrease in UBL5 was transcription-independent and proteasome-dependent. Time-course immunocytochemical studies using exogenous UBL5 revealed that the protein was exported from the nucleus under hypo-osmotic conditions and decreased in a proteasome-dependent manner. This report is the first to describe changes in the intracellular and subcellular localization of UBL5 in response to hypo-osmotic conditions. Our results imply osmoregulation of UBL5.