PML, a RING finger protein with tumor suppressor activity, has been implicated in the pathogenesis of acute promyelocytic leukemia that arises following a reciprocal chromosomal translocation that fuses the PML gene with the retinoic acid receptor alpha (RARalpha) gene. Immunocytochemical analysis has demonstrated that PML is co-localized with a novel ubiquitin-like protein in the nuclear bodies, which could be disrupted by the PML-RARalpha fusion protein. The physical nature of this co-localization is unknown. Using a COS cell expression system, we show that PML is covalently modified by all three members of the sentrin family of ubiquitin-like proteins. Covalent modification of PML requires the conserved Gly residue near the C termini of sentrin proteins. Sentrinization of PML is highly specific because neither NEDD8 nor ubiquitin could modify PML. Similar specificity is also observed for the covalent modification of RanGAP1 by the sentrin member of ubiquitin-like proteins. These observations highlight the fine substrate specificity of the sentrinization pathway. In acute promyelocytic leukemia, two forms of PML-RARalpha fusion proteins have been reported. Remarkably, both forms of PML-RARalpha fusion proteins could not be sentrinized. Thus differential sentrinization of PML and PML-RARalpha could play an important role in regulating the biological function of PML and in the pathogenesis of acute promyelocytic leukemia.