Endoplasmic reticulum-associated degradation (ERAD) is a protein quality control mechanism that eliminates unwanted proteins from the endoplasmic reticulum (ER) through a ubiquitin-dependent proteasomal degradation pathway. gp78 is a previously described ER membrane-anchored ubiquitin ligase (E3) involved in ubiquitination of ER proteins. AAA ATPase (ATPase associated with various cellular activities) p97/valosin-containing protein (VCP) subsequently dislodges the ubiquitinated proteins from the ER and chaperones them to the cytosol, where they undergo proteasomal degradation. We now report that gp78 physically interacts with p97/VCP and enhances p97/VCP-polyubiquitin association. The enhanced association correlates with decreases in ER stress-induced accumulation of polyubiquitinated proteins. This effect is abolished when the p97/VCP-interacting domain of gp78 is removed. Further, using ERAD substrate CD3delta, gp78 consistently enhances p97/VCP-CD3delta binding and facilitates CD3delta degradation. Moreover, inhibition of endogenous gp78 expression by RNA interference markedly increases the levels of total polyubiquitinated proteins, including CD3delta, and abrogates VCP-CD3delta interactions. The gp78 mutant with deletion of its p97/VCP-interacting domain fails to increase CD3delta degradation and leads to accumulation of polyubiquitinated CD3delta, suggesting a failure in delivering ubiquitinated CD3delta for degradation. These data suggest that gp78-p97/VCP interaction may represent one way of coupling ubiquitination with retrotranslocation and degradation of ERAD substrates.