Ubiquitin is important for the release of human immunodeficiency virus 1 (HIV-1) and several other retroviruses. All major domains of the HIV-1 Gag protein are monoubiquitinated, but the modifying machinery and the function of HIV-1 Gag ubiquitination remain unclear. Here, we show that the induction of a late budding arrest by mutation of the HIV-1 PTAP motif or by specific inhibition of selected ESCRT components leads to an increase of Gag-ubiquitin conjugates in cells, which coincides with an accumulation of detergent-insoluble, multimerized Gag at the plasma membrane. Membrane flotation experiments revealed that ubiquitinated Gag is highly enriched in membrane-bound fractions. Based on these findings, we propose that a blocking of virus release results in increased Gag ubiquitination as a consequence of its prolonged membrane association. Consistent with this, ubiquitination of a membrane-binding-defective (G2A)Gag mutant was dramatically reduced and the ubiquitination levels of truncated Gag proteins correlated with their abilities to bind to membranes. We therefore propose that membrane association and multimerization of HIV-1 Gag proteins, rather than a specific motif within Gag, trigger recognition by the cellular ubiquitination machinery.