Mitotic spindle function is critical for cell division and genomic stability. During anaphase, the elongating spindle physically segregates the sister chromatids. However, the molecular mechanisms that determine the extent of anaphase spindle elongation remain largely unclear. In a screen of yeast mutants with altered spindle length, we identified the kinesin-8 Kip3 as essential to scale spindle length with cell size. Kip3 is a multifunctional motor protein with microtubule depolymerase, plus-end motility, and antiparallel sliding activities. Here we demonstrate that the depolymerase activity is indispensable to control spindle length, whereas the motility and sliding activities are not sufficient. Furthermore, the microtubule-destabilizing activity is required to counteract Stu2/XMAP215-mediated microtubule polymerization so that spindle elongation terminates once spindles reach the appropriate final length. Our data support a model where Kip3 directly suppresses spindle microtubule polymerization, limiting midzone length. As a result, sliding forces within the midzone cannot buckle spindle microtubules, which allows the cell boundary to define the extent of spindle elongation.