During development, ventricular chamber maturation is a crucial step in the formation of a functionally competent postnatal heart. Defects in this process can lead to left ventricular noncompaction cardiomyopathy and heart failure. However, molecular mechanisms underlying ventricular chamber development remain incompletely understood. Neddylation is a posttranslational modification that attaches ubiquitin-like protein NEDD8 to protein targets via NEDD8-specific E1-E2-E3 enzymes. Here, we report that neddylation is temporally regulated in the heart and plays a key role in cardiac development. Cardiomyocyte-specific knockout of NAE1, a subunit of the E1 neddylation activating enzyme, significantly decreased neddylated proteins in the heart. Mice lacking NAE1 developed myocardial hypoplasia, ventricular noncompaction, and heart failure at late gestation, which led to perinatal lethality. NAE1 deletion resulted in dysregulation of cell cycle-regulatory genes and blockade of cardiomyocyte proliferation in vivo and in vitro, which was accompanied by the accumulation of the Hippo kinases Mst1 and LATS1/2 and the inactivation of the YAP pathway. Furthermore, reactivation of YAP signaling in NAE1-inactivated cardiomyocytes restored cell proliferation, and YAP-deficient hearts displayed a noncompaction phenotype, supporting an important role of Hippo-YAP signaling in NAE1-depleted hearts. Mechanistically, we found that neddylation regulates Mst1 and LATS2 degradation and that Cullin 7, a NEDD8 substrate, acts as the ubiquitin ligase of Mst1 to enable YAP signaling and cardiomyocyte proliferation. Together, these findings demonstrate a role for neddylation in heart development and, more specifically, in the maturation of ventricular chambers and also identify the NEDD8 substrate Cullin 7 as a regulator of Hippo-YAP signaling.