Parkinson’s disease (PD) is characterized by the degeneration of dopaminergic neurons in the substantia nigra pars compacta (SNc). The loss of SNc dopaminergic neurons affects the plasticity of striatal neurons and leads to significant motor and cognitive disabilities during the progression of the disease. PARK2 encodes for the E3 ubiquitin ligase parkin and is implicated in genetic and sporadic PD. Mutations in PARK2 are a major contributing factor in the early onset of autosomal-recessive juvenile parkinsonism (AR-JP), although the mechanisms by which a disruption in parkin function contributes to the pathophysiology of PD remain unclear. Here we demonstrate that parkin is an E3 ligase for STEP61 (striatal-enriched protein tyrosine phosphatase), a protein tyrosine phosphatase implicated in several neuropsychiatric disorders. In cellular models, parkin ubiquitinates STEP61 and thereby regulates its level through the proteasome system, whereas clinically relevant parkin mutants fail to do so. STEP61 protein levels are elevated on acute down-regulation of parkin or in PARK2 KO rat striatum. Relevant to PD, STEP61 accumulates in the striatum of human sporadic PD and in 1-methyl-4-phenyl-1,2,3,6-tetrahydropyridine (MPTP)-lesioned mice. The increase in STEP61 is associated with a decrease in the phosphorylation of its substrate ERK1/2 and the downstream target of ERK1/2, pCREB [phospho-CREB (cAMP response element-binding protein)]. These results indicate that STEP61 is a novel substrate of parkin, although further studies are necessary to determine whether elevated STEP61 levels directly contribute to the pathophysiology of PD.