Our previous studies have implicated CHIP (carboxyl terminus of Hsp70-interacting protein) as a co-chaperone/ubiquitin ligase whose activities yield protection against stress-induced apoptotic events. In this report, we demonstrate a stress-dependent interaction between CHIP and Daxx (death domain-associated protein). This interaction interferes with the stress-dependent association of HIPK2 with Daxx, blocking phosphorylation of serine 46 in p53 and inhibiting the p53-dependent apoptotic program. Microarray analysis confirmed suppression of the p53-dependent transcriptional portrait in CHIP(+/+) but not in CHIP(-/-) heat shocked mouse embryonic fibroblasts. The interaction between CHIP and Daxx results in ubiquitination of Daxx, which is then partitioned to an insoluble compartment of the cell. In vitro ubiquitination of Daxx by CHIP revealed that ubiquitin chain formation utilizes non-canonical lysine linkages associated with resistance to proteasomal degradation. The ubiquitination of Daxx by CHIP utilizes lysines 630 and 631 and competes with the sumoylation machinery of the cell at these residues. These studies implicate CHIP as a stress-dependent regulator of Daxx that counters the pro-apoptotic influence of Daxx in the cell. By abrogating p53-dependent apoptotic pathways and by ubiquitination competitive with Daxx sumoylation, CHIP integrates the proteotoxic stress response of the cell with cell cycle pathways that influence cell survival.