BAG-1 is a ubiquitin domain protein that links the molecular chaperones Hsc70 and Hsp70 to the proteasome. During proteasomal sorting BAG-1 can cooperate with another co-chaperone, the carboxyl terminus of Hsc70-interacting protein CHIP. CHIP was recently identified as a Hsp70- and Hsp90-associated ubiquitin ligase that labels chaperone-presented proteins with the degradation marker ubiquitin. Here we show that BAG-1 itself is a substrate of the CHIP ubiquitin ligase in vitro and in vivo. CHIP mediates attachment of ubiquitin moieties to BAG-1 in conjunction with ubiquitin-conjugating enzymes of the Ubc4/5 family. Ubiquitylation of BAG-1 is strongly stimulated when a ternary Hsp70.BAG-1.CHIP complex is formed. Complex formation results in the attachment of an atypical polyubiquitin chain to BAG-1, in which the individual ubiquitin moieties are linked through lysine 11. The noncanonical polyubiquitin chain does not induce the degradation of BAG-1, but it stimulates a degradation-independent association of the co-chaperone with the proteasome. Remarkably, this stimulating activity depends on the simultaneous presentation of the integrated ubiquitin-like domain of BAG-1. Our data thus reveal a cooperative recognition of sorting signals at the proteolytic complex. Attachment of polyubiquitin chains to delivery factors may represent a novel mechanism to regulate protein sorting to the proteasome.