The type 2 iodothyronine deiodinase (D2) is an integral membrane ER-resident selenoenzyme that activates the pro-hormone thyroxine (T4) and supplies most of the 3,5,3′-triiodothyronine (T3) that is essential for brain development. D2 is inactivated by selective conjugation to ubiquitin, a process accelerated by T4 catalysis and essential for the maintenance of T3 homeostasis. A yeast two-hybrid screen of a human-brain library with D2 as bait identified von Hippel–Lindau protein–interacting deubiquitinating enzyme-1 (VDU1). D2 interaction with VDU1 and VDU2, a closely related deubiquitinase, was confirmed in mammalian cells. Both VDU proteins colocalize with D2 in the ER, and their coexpression prolongs D2 half-life and activity by D2 deubiquitination. VDU1, but not VDU2, is markedly increased in brown adipocytes by norepinephrine or cold exposure, further amplifying the increase in D2 activity that results from catecholamine-stimulated de novo synthesis. Thus, deubiquitination regulates the supply of active thyroid hormone to brown adipocytes and other D2-expressing cells.