Ubiquitylation of proteins can be a signal for a variety of cellular processes beyond the classical role in proteolysis. The different signaling functions of ubiquitylation are thought to rely on ubiquitin-binding domains (UBDs). Several distinct UBD families are known, but their functions are not understood in detail, and mechanisms for interpretation and transmission of the ubiquitin signals remain to be discovered. One interesting example of the complexity of ubiquitin signaling is the Saccharomyces cerevisiae transcription factor Met4, which is regulated by a single lysine-48 linked polyubiquitin chain that can directly repress activity of Met4 or induce degradation by the proteasome. Here we show that ubiquitin signaling in Met4 is controlled by its tandem UBD regions, consisting of a previously recognized ubiquitin-interacting motif and a novel ubiquitin-binding region, which lacks homology to known UBDs. The tandem arrangement of UBDs is required to protect ubiquitylated Met4 from degradation and enables direct inactivation of Met4 by ubiquitylation. Interestingly, protection from proteasomes is a portable feature of UBDs because a fusion of the tandem UBDs to the classic proteasome substrate Sic1 stabilized Sic1 in vivo in its ubiquitylated form. Using the well-defined Sic1 in vitro ubiquitylation system we demonstrate that the tandem UBDs inhibit efficient polyubiquitin chain elongation but have no effect on initiation of ubiquitylation. Importantly, we show that the nonproteolytic regulation enabled by the tandem UBDs is critical for ensuring rapid transcriptional responses to nutritional stress, thus demonstrating an important physiological function for tandem ubiquitin-binding domains that protect ubiquitylated proteins from degradation.