The linear ubiquitin (Ub) chain assembly complex (LUBAC) generates Met1-linked 
"linear" Ub chains that regulate the activation of the nuclear factor κB (NFκB) 
transcription factor and other processes. We recently discovered OTULIN as a 
deubiquitinase that specifically cleaves Met1-linked polyUb. Now, we show that 
OTULIN binds via a conserved PUB-interacting motif (PIM) to the PUB domain of 
the LUBAC component HOIP. Crystal structures and nuclear magnetic resonance 
experiments reveal the molecular basis for the high-affinity interaction and 
explain why OTULIN binds the HOIP PUB domain specifically. Analysis of 
LUBAC-induced NFκB signaling suggests that OTULIN needs to be present on LUBAC 
in order to restrict Met1-polyUb signaling. Moreover, LUBAC-OTULIN complex 
formation is regulated by OTULIN phosphorylation in the PIM. Phosphorylation of 
OTULIN prevents HOIP binding, whereas unphosphorylated OTULIN is part of the 
endogenous LUBAC complex. Our work exemplifies how coordination of ubiquitin 
assembly and disassembly activities in protein complexes regulates individual Ub 
linkage types.