BRCA1-BARD1 constitutes a heterodimeric RING finger complex associated through its N-terminal regions. Here we demonstrate that the BRCA1-BARD1 heterodimeric RING finger complex contains significant ubiquitin ligase activity that can be disrupted by a breast cancer-derived RING finger mutation in BRCA1. Whereas individually BRCA1 and BARD1 have very low ubiquitin ligase activities in vitro, BRCA1 combined with BARD1 exhibits dramatically higher activity. Bacterially purified RING finger domains comprising residues 1-304 of BRCA1 and residues 25-189 of BARD1 are capable of polymerizing ubiquitin. The steady-state level of transfected BRCA1 in vivo was increased by co-transfection of BARD1, and reciprocally that of transfected BARD1 was increased by BRCA1 in a dose-dependent manner. The breast cancer-derived BARD1-interaction-deficient mutant, BRCA1(C61G), does not exhibit ubiquitin ligase activity in vitro. These results suggest that the BRCA1-BARD1 complex contains a ubiquitin ligase activity that is important in prevention of breast and ovarian cancer development.