Abstract Disruption of the polyubiquitin gene Ubb leads to hypothalamic neurodegeneration and metabolic disorders, including obesity and sleep abnormalities, in mice. However, it has yet to be determined whether or not these neural phenotypes in Ubb−/− mice are directly caused by cell autonomous defects in maintaining proper levels of ubiquitin (Ub). To directly demonstrate that reduced levels of Ub are sufficient to cause neuronal abnormalities, we investigated the characteristics of cultured neurons isolated from Ubb−/− mouse embryonic brains. We found that neuronal morphology, neurite outgrowth, and synaptic development were significantly impaired in Ubb−/− neurons. Furthermore, we observed the growth of astrocytes in Ubb−/− cell cultures despite the fact that cells were cultured under conditions promoting neuronal growth. When the reduced levels of free Ub, but not Ub conjugates, in Ubb−/− cells were restored to those of wild-type cells by providing exogenous Ub via lentivirus-mediated delivery, the increased apoptosis observed in Ubb−/− cells was almost completely abolished. Ectopic expression of Ub also improved neuronal and glial phenotypes observed in Ubb−/− cells. Therefore, our study suggests that Ub homeostasis, or the maintenance of cellular free Ub above certain threshold levels, is essential for proper neuronal development and survival.