Chromosome instability (CIN) is an enabling feature of oncogenesis associated with poor patient outcomes, whose genetic determinants remain largely unknown. As mitotic chromatin compaction defects can compromise the accuracy of chromosome segregation into daughter cells and drive CIN, characterizing the molecular mechanisms ensuring accurate chromatin compaction may identify novel CIN genes. In vitro, histone H2B monoubiquitination at lysine 120 (H2Bub1) impairs chromatin compaction, while in vivo H2Bub1 is rapidly depleted from chromatin upon entry into mitosis, suggesting that H2Bub1 removal may be a pre-requisite for mitotic fidelity. The deubiquitinating enzyme USP22 catalyzes H2Bub1 removal in interphase and may also be required for H2Bub1 removal in early mitosis to maintain chromosome stability. In this study, we demonstrate that siRNA-mediated USP22 depletion increases H2Bub1 levels in early mitosis and induces CIN phenotypes associated with mitotic chromatin compaction defects revealed by super-resolution microscopy. Moreover, USP22-knockout models exhibit continuously changing chromosome complements over time. These data identify mitotic removal of H2Bub1 as a critical determinant of chromatin compaction and faithful chromosome segregation. We further demonstrate that USP22 is a CIN gene, indicating that USP22 deletions, which are frequent in many tumor types, may drive genetic heterogeneity and contribute to cancer pathogenesis.