Heme-oxidized IRP2 ubiquitin ligase 1 (HOIL-1L) serves as a unique E3 ligase to catalyze the mono-ubiquitination of relevant protein or sugar substrates and plays vital roles in numerous cellular processes in mammals. However, the molecular mechanism underpinning the E3 activity of HOIL-1L and the related regulatory mechanism remain elusive. Here, we report the crystal structure of the catalytic core region of HOIL-1L and unveil the key catalytic triad residues of HOIL-1L. Moreover, we discover that HOIL-1L contains two distinct linear di-ubiquitin binding sites that can synergistically bind to linear tetra-ubiquitin, and the binding of HOIL-1L with linear tetra-ubiquitin can promote its E3 activity. The determined HOIL-1L/linear tetra-ubiquitin complex structure not only elucidates the detailed binding mechanism of HOIL-1L with linear tetra-ubiquitin but also uncovers a unique allosteric ubiquitin-binding site for the activation of HOIL-1L. In all, our findings provide mechanistic insights into the E3 activity of HOIL-1L and its regulation by the linear ubiquitin chain binding.