Monoubiquitination aids in the nuclear export and entrance of proteins into the lysosomal degradative pathway, although the mechanisms are unknown. Cytidylyltransferase (CCTα) is a proteolytically sensitive lipogenic enzyme containing an NH₂-terminal nuclear localization signal (NLS). We show here that CCTα is monoubiquitinated at a molecular site (K⁵⁷⁾ juxtaposed near its NLS, resulting in disruption of its interaction with importin-α, nuclear exclusion, and subsequent degradation within the lysosome. Cellular expression of a CCTα-ubiquitin fusion protein that mimics the monoubiquitinated enzyme resulted in cytoplasmic retention. A CCTα K^57R mutant exhibited an extended half-life, was retained in the nucleus, and displayed proteolytic resistance. Importantly, by using CCTα-ubiquitin hybrid constructs that vary in the intermolecular distance between ubiquitin and the NLS, we show that CCTα monoubiquitination masks its NLS, resulting in cytoplasmic retention. These results unravel a unique molecular mechanism whereby monoubiquitination governs the trafficking and life span of a critical regulatory enzyme in vivo.