Retinoid X receptor alpha (RXRalpha) belongs to a family of ligand-activated transcription factors that regulate many aspects of metazoan life. Here we demonstrate that RXRalpha is a target substrate of a small ubiquitin-related modifier (SUMO)-specific protease, SUSP1, which is capable of controlling the transcriptional activity of RXRalpha. RXRalpha was modified by SUMO-1 in vivo as well as in vitro, and the Lys-108 residue within the IKPP sequence of RXRalpha AF-1 domain was identified as the major SUMO-1 acceptor site. Prevention of SUMO modification by Lys-to-Arg mutation led to an increase not only in the transcriptional activity of RXRalpha but also in the activity of its heterodimeric complex with retinoic acid receptor-alpha or peroxisome proliferator-activated receptor-gamma (PPARgamma). SUSP1 co-localized with RXRalpha in the nucleus and removed SUMO-1 from RXRalpha but not from androgen receptor or PPARgamma. Moreover, overexpression of SUSP1 caused an increase in the transcriptional activity of RXRalpha, whereas small hairpin RNA-mediated knockdown of endogenous SUSP1 led to a decrease in RXRalpha activity. These results suggest that SUSP1 plays an important role in the control of the transcriptional activity of RXRalpha and thus in the RXRalpha-mediated cellular processes.