ISG15 is an interferon-induced and anti-viral ubiquitin-like protein (Ubl). Ube1L, UbcH8, and Herc5 have been identified as the E1-E2-E3 enzymes for ISG15 conjugation, and, like ISG15, their expression is induced by type I interferons. Although Herc5 is the major E3 for ISG15, over 300 proteins have been identified as ISG15 target proteins in interferon-stimulated cells. In this work, I address two aspects of the human ISG15 conjugation system: 1) the specificity of the Ube1L-UbcH8 interaction and 2), the basis of substrate recognition by Herc5. Regarding the selection of UbcH8 by Ube1L, my experiments show that although UbcH8 had been reported to function as an E2 for both Ub and ISG15, UbcH8 is preferentially activated by Ube1L compared to Ube1 (E1[superscript Ub]). The basis of this preference is a result of specific interactions between the ubiquitin-fold domain (UFD) of Ube1L and the amino-terminal [alpha]1 helix and [beta]1 [beta]2 region within UbcH8. Examination of the interferon-induced and transfected expression levels of UbcH8, combined with the kinetic constants, suggest that UbcH8 is unlikely to function as a Ub E2 in most cell lines. In examining the selection of target proteins by Herc5, I show that the range of substrates extends far beyond the proteins identified in proteomics studies and includes many exogenously expressed foreign proteins. Furthermore, I show that ISG15 conjugation is restricted to newly synthesized pools of proteins and Herc5 is associated with polyribosomes. I propose a model for ISGylation in which Herc5 broadly modifies newly synthesized proteins in a co-translational manner and suggest that, in the context of an interferon-stimulated cell, newly translated viral proteins may be primary targets of ISG15. Consistent with this, I show that ISGylation of human papillomavirus (HPV) L1 capsid protein has a dominant-inhibitory effect on the infectivity of HPV16 pseudoviruses. These discoveries have greatly increased our understanding of the mechanism of ISG15 pathway and provide a framework for establishing an in vitro ISG15 conjugation system and further examination of the anti-viral function of ISG15. / text