The PML tumor suppressor is the founding component of the multiprotein nuclear structures known as PML nuclear bodies (PML-NBs), which control several cellular functions including apoptosis and antiviral effects. The ubiquitin specific protease USP7 (also called HAUSP) is known to associate with PML-NBs and to be a tight binding partner of two herpesvirus proteins that disrupt PML NBs. Here we investigated whether USP7 itself regulates PML-NBs. Silencing of USP7 was found to increase the number of PML-NBs, to increase the levels of PML protein and to inhibit PML polyubiquitylation in nasopharyngeal carcinoma cells. This effect of USP7 was independent of p53 as PML loss was observed in p53-null cells. PML-NBs disruption was induced by USP7 overexpression independently of its catalytic activity and was induced by either of the protein interaction domains of USP7, each of which localized to PML-NBs. USP7 also disrupted NBs formed from some single PML isoforms, most notably isoforms I and IV. CK2α and RNF4, which are known regulators of PML, were dispensable for USP7-associated PML-NB disruption. The results are consistent with a novel model of PML regulation where a deubiquitylase disrupts PML-NBs through recruitment of another cellular protein(s) to PML NBs, independently of its catalytic activity.