Recently, linear ubiquitin assembly complex (LUBAC)-mediated linear ubiquitination has come into focus due to its emerging role in activation of NF-κB in different biological contexts. However, the role of LUBAC in LMP1 signaling leading to NF-κB and interferon regulatory factor 7 (IRF7) activation has not been investigated. We show here that RNF31, the key component of LUBAC, interacts with LMP1 and IRF7 in Epstein-Barr virus (EBV)-transformed cells and that LUBAC stimulates linear ubiquitination of NEMO and IRF7. Consequently, LUBAC is required for LMP1 signaling to full activation of NF-κB but inhibits LMP1-stimulated IRF7 transcriptional activity. The protein levels of RNF31 and LMP1 are correlated in EBV-transformed cells. Knockdown of RNF31 in EBV-transformed IB4 cells by RNA interference negatively regulates the expression of the genes downstream of LMP1 signaling and results in a decrease of cell proliferation. These lines of evidence indicate that LUBAC-mediated linear ubiquitination plays crucial roles in regulating LMP1 signaling and functions. IMPORTANCE We show here that LUBAC-mediated linear ubiquitination is required for LMP1 activation of NF-κB but inhibits LMP1-mediated IRF7 activation. Our findings provide novel mechanisms underlying EBV-mediated oncogenesis and may have a broad impact on IRF7-mediated immune responses.