ISG15 is a ubiquitin-like molecule whose expression is induced by type I IFN (IFN-α/β) or in response to virus or bacterial infection. ISG15 or conjugation of ISG15 to target proteins was reported to play critical roles in the regulation of antiviral responses. IFN restricts replication of hepatitis C virus (HCV). However, molecular mechanism of IFN-α/β that inhibits HCV replication is not clear yet. In the current study, we demonstrated that replication of HCV was inhibited by overexpression of ISG15 and ISG15-conjugation enzymes in the HCV subgenomic replicon cells. Among various nonstructural proteins of HCV, NS5A was identified as the substrate for ISGylation. Furthermore, protein stability of NS5A was decreased by overexpression of ISG15 or ISG15-conjugating enzymes. The inhibitory effect of ISG15 or ISGylation on NS5A was efficiently blocked by substitution of lysine at 379 residue to arginine within the C-terminal region, suggesting that ISGylation directly controls protein stability of NS5A. Finally, the inhibitory effect of IFN-α/β on HCV replication was further enhanced by ISGylation, suggesting ISG15 as a therapeutic tool for combined therapy with IFN against HCV.