The Krüppel-like transcription factor ZBP-89 is a sequence-specific regulator that plays key roles in cellular growth and differentiation especially in endodermal and germ cell lineages. ZBP-89 shares with other members of the Sp-like family an overlapping sequence specificity for GC-rich sequences in the regulatory regions of multiple genes. Defining the mechanisms that govern the intrinsic function of ZBP-89 as well as its competitive and non-competitive functional interactions with other regulators is central to understand how ZBP-89 exerts its biological functions. We now describe that post-translational modification of ZBP-89 by multiple small ubiquitin-like modifier (SUMO) isoforms occurs at two conserved synergy control motifs flanking the DNA binding domain. Functionally sumoylation did not directly alter the ability of ZBP-89 to compete with other Sp-like factors from individual sites. At promoters bearing multiple response elements, however, this modification inhibited the functional cooperation between ZBP-89 and Sp1. Analysis of the properties of ZBP-89 in cellular contexts devoid of competing factors indicated that although on its own it behaves as a modest activator it potently synergizes with heterologous activators such as the glucocorticoid receptor. Notably we found that when conjugated to ZBP-89, SUMO exerts a strong inhibitory effect on such synergistic interactions through a critical conserved functional surface. By regulating higher order functional interactions, sumoylation provides a reversible post-translational mechanism to control the activity of ZBP-89.