The TRE17 (USP6/TRE-2) oncogene induces tumorigenesis in both humans and mice. However, little is known regarding its regulation or mechanism of transformation. TRE17 encodes a TBC (Tre-2/Bub2/Cdc16)/Rab GAP homology domain at its N-terminus and a ubiquitin-specific protease (USP) at its C-terminus. In the current study, we identify the ubiquitous calcium (Ca2+)-binding protein calmodulin (CaM) as a novel binding partner for TRE17. CaM bound directly to TRE17 in a Ca2+-dependent manner both in vitro and in vivo. The CaM-binding site was mapped to two hydrophobic motifs near the C-terminus of the TBC domain. Point mutations within these motifs significantly reduced TRE17's interaction with CaM. We further found that TRE17 is mono-ubiquitinated, and promotes its own de-ubiquitination in vivo. CaM binding-deficient mutants of TRE17 exhibited significantly reduced mono-ubiquitination, suggesting that binding of Ca2+/CaM to TRE17 promotes this modification. Consistent with this notion, treatment of cells with the CaM inhibitor W7 reduced levels of TRE17 mono-ubiquitination. Interestingly, the calcium ionophore A23187 induced accumulation of a poly-ubiquitinated TRE17 species. The effect of A23187 was attenuated in CaM binding-deficient mutants of TRE17. Taken together, these studies indicate a role for Ca2+/CaM in regulating ubiquitination through direct interaction with TRE17.