SUMO-targeted ubiquitin ligases (STUbLs) recognize sumoylated proteins as substrates for ubiquitylation and have been implicated in several aspects of DNA repair and the damage response. However, few physiological STUbL substrates have been identified, and the relative importance of SUMO binding versus direct interactions with the substrate remains a matter of debate. We now present evidence that the ubiquitin ligase Rad18 from Saccharomyces cerevisiae, which monoubiquitylates the sliding clamp protein proliferating cell nuclear antigen (PCNA) in response to DNA damage, exhibits the hallmarks of a STUbL. Although not completely dependent on sumoylation, Rad18's activity towards PCNA is strongly enhanced by the presence of SUMO on the clamp. The stimulation is brought about by a SUMO-interacting motif in Rad18, which also mediates sumoylation of Rad18 itself. Our results imply that sumoylated PCNA is the physiological ubiquitylation target of budding yeast Rad18 and suggest a new mechanism by which the transition from S phase-associated sumoylation to damage-induced ubiquitylation of PCNA is accomplished.