Skeletal muscle atrophy caused by unloading is characterized by both decreased responsiveness to myogenic growth factors (e.g., insulin-like growth factor 1 [IGF-1] and insulin) and increased proteolysis. Here, we show that unloading stress resulted in skeletal muscle atrophy through the induction and activation of the ubiquitin ligase Cbl-b. Upon induction, Cbl-b interacted with and degraded the IGF-1 signaling intermediate IRS-1. In turn, the loss of IRS-1 activated the FOXO3-dependent induction of atrogin-1/MAFbx, a dominant mediator of proteolysis in atrophic muscle. Cbl-b-deficient mice were resistant to unloading-induced atrophy and the loss of muscle function. Furthermore, a pentapeptide mimetic of tyrosine(608)-phosphorylated IRS-1 inhibited Cbl-b-mediated IRS-1 ubiquitination and strongly decreased the Cbl-b-mediated induction of atrogin-1/MAFbx. Our results indicate that the Cbl-b-dependent destruction of IRS-1 is a critical dual mediator of both increased protein degradation and reduced protein synthesis observed in unloading-induced muscle atrophy. The inhibition of Cbl-b-mediated ubiquitination may be a new therapeutic strategy for unloading-mediated muscle atrophy.