We have previously shown that modification of Tcf-4, a transcription factor in the Writ pathway, with SUMO by PIASy, a SUMO E3 ligase, enhances its transcriptional activity. Since PIASy itself was also modified with SUMO-1, we studied the role of sumoylation of PIASy in the regulation of Tcf-4. Lys(35) was found to be a sumoylation site of PIASy. PIASy(K35R), in which Lys(35) was mutated to Arg, did not enhance sumoylation of Tcf-4, although this PIASy mutant did not lose the ligase activity of sumoylation for other proteins. Wild-type PIASy and PIASyK35R showed a distinct distribution in the nucleus, although both were colocallized with Tef-4. Promyelocytic leukemia protein, which is involved in transcriptional regulation, was associated with PIASy(K35R) more frequently than wild-type PIASy in the nucleus. PIASy(K35R) could not stimulate the transcriptional activity of Tcf-4 under the conditions in which wild-type PIASy enhanced it. Conjugation of SUMO-1 to the amino terminus of PIASy(K35R) neither enhanced sumoylation of Tcf-4 nor stimulated the transcriptional activity of Tcf-4. These results suggest that sumoylation of Lys(35) in PIASy determines the nuclear localization of PIASy and that it is necessary for PIASy-dependent sumoylation and transcriptional activation of Tcf-4.