Deubiquitinase involved both in the processing of ubiquitin precursors and of ubiquitinated proteins. May therefore play an important regulatory role at the level of protein turnover by preventing degradation of proteins through the removal of conjugated ubiquitin. Specifically hydrolyzes 'Lys-48'-, 'Lys-29'- and 'Lys-33'-linked polyubiquitins chains. Essential component of TGF-beta/BMP signaling cascade. Specifically deubiquitinates monoubiquitinated SMAD4, opposing the activity of E3 ubiquitin-protein ligase TRIM33. Deubiquitinates alkylation repair enzyme ALKBH3. OTUD4 recruits USP7 and USP9X to stabilize ALKBH3, thereby promoting the repair of alkylated DNA lesions. Regulates chromosome alignment and segregation in mitosis by regulating the localization of BIRC5/survivin to mitotic centromeres. Involved in axonal growth and neuronal cell migration.
