Otubain 1 belongs to the ovarian tumor (OTU) domain class of cysteine protease deubiquitinating enzymes. We show here that human otubain 1 (hOtu1) is highly linkage-specific, cleaving Lys48 (K48)-linked polyubiquitin but not K63-, K29-, K6-, or K11-linked polyubiquitin, or linear alpha-linked polyubiquitin. Cleavage is not limited to either end of a polyubiquitin chain, and both free and substrate-linked polyubiquitin are disassembled. Intriguingly, cleavage of K48-diubiquitin by hOtu1 can be inhibited by diubiquitins of various linkage types, as well as by monoubiquitin. NMR studies and activity assays suggest that both the proximal and distal units of K48-diubiquitin bind to hOtu1. Reaction of Cys23 with ubiquitin-vinylsulfone identified a ubiquitin binding site that is distinct from the active site, which includes Cys91. Occupancy of the active site is needed to enable tight binding to the second site. We propose that distinct binding sites for the ubiquitins on either side of the scissile bond allow hOtu1 to discriminate among different isopeptide linkages in polyubiquitin substrates. Bidentate binding may be a general strategy used to achieve linkage-specific deubiquitination.