Nucleophosmin/B23 is a major multifunctional nucleolar phosphoprotein that plays a critical role in ribosome biogenesis and cell proliferation. Arf tumor suppressor binds B23 and enhances its sumoylation. However, the biological effects of this event remain unknown. Here we show that B23 is sumoylated on both Lysine 230 and 263 residues, but the latter is the major one. Mutation of K263, but not K230, into R abolishes its centrosomal and nucleolar residency. Moreover, Rb binds to wild-type B23, but fails to interact with K263R. Sumoylation enhances B23 binding to Rb. Consequently, B23 potently stimulates E2F1-mediated transcriptional activity, which is abolished in B23 K263R. Further, K263R mutation makes B23 vulnerable to caspase-3 cleavage and sensitizes cells to apoptosis. Surprisingly, K230R mutant strongly binds to phosphatidylinositol-3,4,5-trisphosphate and suppresses DNA fragmentation. Thus, B23 sumoylation regulates its subcellular localization, cell proliferation, and survival activities.centrosome ͉ nucleolus ͉ sumoylation ͉ K263 N ucleophosmin (NPM)/B23 is a multifunctional protein involved in many cellular activities, and it has been attributed with both oncogenic and tumor-suppressive functions. B23 is more abundant in tumor and growing cells than in normal resting cells (1, 2). In addition, B23 is frequently found in the chromosomal translocation associated with several hematopoietic malignancies, such as acute promyelocytic leukemia (3), anaplastic large-cell lymphomas (4), and myelodysplasia/acute myeloid leukemia (5). Furthermore, certain mutations in the NPM gene incur the cytoplasmic localization of mutated B23, which has been proposed as a biomarker for certain acute myelogenous leukemia (6, 7). Overexpression of B23 induces cell cycle arrest in normal fibroblasts, whereas it promotes S phase entry in cells lacking p53. Conversely, knocking down B23 inhibits the processing of preribosomal RNA and induces cell death (8). In agreement with these observations, overexpression of B23 decreases the susceptibility of human leukemia HL-60 cells to retinoic acid-induced differentiation and apoptosis as well as UV-induced apoptosis in NIH 3T3 cells (9-11). Nonetheless, B23 can be cleaved by active caspase-3, which may influence its antiapoptotic action (12). It has been shown that B23 suppresses hypoxia or UV-induced cell death by repressing p53 phosphorylation and transcription activity (13,14). Recently, we presented biochemical evidence revealing that B23 is a nuclear phosphatidylinositol-3,4,5-trisphosphate [PI(3,4,5)P 3 ] receptor, and this complex directly interacts with caspase-activated DNase and inhibits its DNA fragmentation activity (15). Thus, these findings demonstrate that B23 acts as a physiologically important antiapoptotic protein. However, emerging evidence demonstrates that B23 can also act as a tumor suppressor. Npm germ-line deletion reveals that it is essential for embryonic development and the maintenance of genomic stability. Npm1 heterozygosity accelerates oncogenesis both in ...