Parkin E3-ligase is an auto-inhibited enzyme activated by phosphorylation of ubiquitin or ubiquitin-like (Ubl) domain of parkin by PINK1. Parkin mutations are known to affect its function leading to the onset of Parkinson’s disease. Herein, we show a competitive binding mode of the phospho-Ubl and RING2 domains on the RING0 domain, which regulates parkin activity. We show that phosphorylated parkin forms complex with native parkin leading to the activation of autoinhibited parkin in trans. Furthermore, we show that the activator element (ACT) of parkin is required to maintain the enzyme’s kinetics, and removal of ACT slows the enzyme catalysis. We also show that ACT can activate parkin in trans; however, it is more effective when present in the cis molecule. Furthermore, we identified and characterized a new donor ubiquitin binding pocket that plays a crucial role in parkin function.