We have discovered a ubiquitin (Ub)-specific cysteine protease encoded within the N-terminal approximately 500 residues of the UL36 gene product, the largest (3164 aa) tegument protein of herpes simplex virus 1 (HSV-1). Enzymatic activity of this fragment, UL36USP, is detectable only after cleavage of UL36USP from full-length UL36 and occurs late during viral replication. UL36USP bears no homology to known deubiquitinating enzymes (DUBs) or Ub binding proteins. Sequence alignment of the large tegument proteins across the family Herpesviridae indicates conservation of key catalytic residues amongst these viruses. Recombinant UL36USP exhibits hydrolytic activity toward Ub-AMC and ubiquitinated branched peptides in vitro. In addition, recombinant UL36USP can cleave polyUb chains and appears to be specific for Lys48 linkages. Mutation of the active site cysteine residue (Cys65) to alanine abolishes this enzymatic activity. The lack of homology between UL36USP and eukaryotic DUBs makes this new family of herpesvirus ubiquitin-specific proteases attractive targets for selective inhibition.