The human T-cell leukemia virus type 1 (HTLV-1) is the etiological agent of adult T-cell leukemia and a virus-associated neurodegenerative disease, HTLV-1-associated myelopathy/tropical spastic paraparesis (31, 36, 47). These two diseases have been linked to the expression of the HTLV-1 regulatory protein Tax (10, 13, 29, 41). Tax is a potent transcriptional activator of viral genes as well as specific cellular genes and has a clear oncogenic potential since Tax is able to transform T lymphocytes and fibroblasts and induces tumors in transgenic mice (19). A substantial part of the oncogenic properties of Tax is associated with its ability to activate the expression of cellular genes that control T-cell proliferation and differentiation by inducing constitutive activation of the NF-κB pathway (2, 38). In nonstimulated cells, inactive NF-κB complexes composed of p50 and RelA heterodimers are retained in the cytoplasm by NF-κB inhibitors of the IκB family (15, 23, 40). Tax activation of the NF-κB pathway involves its interaction with the regulatory subunit of the IκB kinase (IKK) complex, NEMO/IKKγ, leading to the activation of the two catalytic subunits, IKKα and IKKβ (8, 14). Activation of the IκB kinase complex by Tax determines the phosphorylation of the IκB proteins, leading to their ubiquitination and degradation by the proteasome and to the migration of the NF-κB complexes to the nucleus (18, 45, 46). It also determines the phosphorylation of the RelA subunit of NF-κB, a prerequisite for activation of RelA and p50 heterodimers in the nucleus (30). However, Tax also colocalizes in discrete nuclear bodies (NB) with the two subunits of NF-κB, p50 and RelA, in addition to RNA polymerase II, and the assembly of these nuclear structures correlates with Tax transcriptional activity (4-6, 37). Thus, Tax-mediated activation of gene expression may require the presence of Tax both in the cytoplasm and in the nucleus (3). Ubiquitin (Ub) and the small ubiquitin-like modifier (SUMO) are polypeptides which are attached to the lysine residues of a number of proteins via isopeptidic bonds, leading to the subsequent formation of poly-ubiquitinated or poly-sumoylated branched molecules. Ubiquitination and sumoylation often compete for the same lysine residues and have opposite effects in regulating the function of a variety of transcription factors by altering their intracellular targeting, their interaction with specific partners, and/or their stability (9, 22, 24, 27). Although poly-ubiquitinated proteins are often targeted to the proteasome, SUMO modification results in the targeting to subnuclear domains called nuclear bodies, as was first observed for the promyelocytic leukemia protein (PML) (27, 48). Activation of the NF-κB pathway following genotoxic stress requires the sequential sumoylation and nuclear targeting of IKKγ, followed by its ubiquitination, permitting IKK activation in the cytoplasm (16). Tax is ubiquitinated on carboxy-terminal lysine residues, and this modification is critical for Tax interaction with the proteasome (7, 34). In this work, we demonstrate that Tax is sumoylated and ubiquitinated on overlapping lysine residues. These two modifications determine the partitioning of Tax in the nuclear and cytoplasmic compartments. Colocalized Tax and ubiquitin molecules were detected in the cytoplasm only, in association with IKK complexes, and this modification plays a critical role in the translocation of the RelA subunit of NF-κB to the nucleus. However, the sumoylation of Tax and the subsequent formation of the Tax nuclear bodies that contained both RelA and IKKγ must also occur for Tax-mediated activation of gene expression via the NF-κB pathway. These results demonstrate that both the sumoylation and the ubiquitination of Tax are critical for Tax-mediated transcriptional activity.