Conjugation of ISG15 inhibits replication of several viruses. Here, using an expression system for assaying human and mouse ISG15 conjugations (ISGylations), we have demonstrated that vaccinia virus E3 protein binds and antagonizes human and mouse ISG15 modification. To study ISGylation importance in poxvirus infection, we used a mouse model that expresses deconjugating proteases. Our results indicate that ISGylation restricts in vitro replication of the vaccinia virus VV⌬E3L mutant but unconjugated ISG15 is crucial to counteract the inflammatory response produced after VV⌬E3L infection.is essential for controlling the replication of viruses in their mammalian hosts. Binding of IFN-␣/ to its receptor activates the Janus kinase signal transducer and activator of transcription (JAK/STAT) pathway and consequently leads to the upregulation of hundreds of IFN-stimulated genes (ISG) (1). One of the most highly induced genes is ISG15, which encodes a small ubiquitin-like (UBL) protein of 17 kDa that forms covalent conjugates with cellular and viral proteins mediating a considerable antiviral response (2, 3). ISG15 is composed of two domains, each of which carries high sequence and structural similarity to ubiquitin (UB) (33 and 32% for the N-and C-terminal domains, respectively [4]). Conjugation of ISG15 to its protein substrates follows principles similar to those with UB, requiring an E1-activating enzyme (UBE1L), an E2-conjugating enzyme (UbcH8), and an E3 ligase, which in humans is mainly Herc5, while in mice mHerc6 performs this function (5, 6).The mechanism responsible for the antiviral activity of ISG15 is not clearly understood. ISG15 has been reported to be conjugated to proteins involved in direct or indirect antiviral activity, including RIG-I, JAK1, STAT1, interferon regulatory factor 3 (IRF3), and protein kinase R (PKR) (7,8). It has also been shown that IRF3 ISG15 conjugation (ISGylation) prevents its ubiquitination and degradation, enhancing its translocation to the nucleus. Consequently, the relative amount of IRF3 is reduced in ISG15 Ϫ/Ϫ cells compared to that in ISG15 ϩ/ϩ cells (9). ISG15 negatively regulates important cell signaling pathways, such as RIG-I-like receptor (RLR) signaling and activation of NF-B (10, 11). On the other hand, protein de-ISGylation negatively regulates the JAK/ STAT pathway (7). It has also been suggested that conjugation of ISG15 to viral proteins has detrimental effects in viral replication. Finally, free, unconjugated ISG15 appear to have antiviral properties, at least for some viruses (12).Studies with several viruses have verified that ISG15 plays an essential role in the antiviral response (13,14). Thus, evidence supports the antiviral activity of both conjugated and unconjugated ISG15. For Sindbis virus, the increased lethality seen in ISG15 Ϫ/Ϫ mice can be rescued by a recombinant virus expressing wild-type (WT) ISG15 but not mutant ISG15, the latter not being able to form conjugates in vitro (15). In contrast, two reports showed that free ISG15, in the absence of ...