NEDD8 is another ubiquitin-like molecule (UBL), which becomes covalently conjugated to a limited number of cellular proteins in a manner analogous to ubiquitination. Human NEDD8 shares 60% amino acid sequence identity to Ub and is structurally most similar to Ub than other UBLs.

Like Ub, NEDD8 has similar structural features and invariant residues that are important for NEDD8-specific functions. These include sequences at the C-terminus and most of the lysine residues (including K48 which is critical for Ub degradation signalling), and a hydrophobic patch ((Leu-8, Ile-44, Val-70). The mechanisms of NEDD8 metabolism, activation, conjugation and deconjugation parallel that of Ub. NEDD8 is also translated as a precursor protein with additional C-terminal residues that have to be removed to expose the conserved di-glycine motif that is characteristic of the mature and active form. NEDD8 is also activated by a distinct E1-like enzyme and dedicated E2 enzymes to form conjugates with intracellular proteins.

The human NEDD8 activating E1 enzyme is a heterodimer composed of APPBP1 and UBA3 subunits. The APPBP1/UBA3 enzyme has homology to the N- and C-terminal halves of the ubiquitin E1 enzyme, respectively. The UBA3 subunit contains the catalytic center and activates NEDD8 in an ATP-dependent reaction by forming a high-energy thiolester intermediate. The activated NEDD8 is subsequently transferred to the UbcH12 (Ube2M) or Ube2F E2 enzymes, and is then conjugated to specific substrates in the presence of the appropriate E3 ligases. The best characterized substrates of NEDD8 modification are the cullin subunits of SCF ubiquitin E3 ligases. Cullins function as a core scaffold for cullin-RING ligase enzymes (CLRs or SCF) and together they define one of the largest subfamily of RING-based E3s. The NEDDylation of cullins is critical for the recruitment of E2 to the ligase complex which promotes ubiquitination by CLRs. NEDDylation thus regulates the ubiquitination and degradation of CLR-dependent protein substrates and has therefore been implicated in cell cycle progression and control, cytoskeletal regulation and embryogenesis. Ube2F interacts specifically with the E3 ubiquitin ligase RBX2, but not RBX1, suggests that the RBX2-UBE2F complex modifies specific target proteins, such as CUL5. UbcH12 with interacts with RBX1 and targets different types of cullin substrates. The UBE2F and UBE2M enzymes thus represent a hierarchical expansion of the NEDD8 conjugation system in establishing selective culling RING ligase activation which influences substrate sub-type NEDDylation.