The multisubunit SAGA coactivator complex facilitates access of general transcription factors to DNA through histone acetylation mediated by GCN5. USP22 (ubiquitin-specific protease 22) was recently described as a subunit of the human SAGA complex that removes ubiquitin from monoubiquitinated histone H2B and H2A in vitro. Here we demonstrate an allosteric regulation of USP22 through multiple interactions with different domains of other subunits of the SAGA deubiquitination module (ATXN7, ATXN7L3, and ENY2). Downregulation of ATXN7L3 by short hairpin RNA (shRNA) specifically inactivated the SAGA deubiquitination activity, leading to a strong increase of global H2B ubiquitination and a moderate increase of H2A ubiquitination. Thus, SAGA is the major H2Bub deubiquitinase in human cells, and this activity cannot be fully compensated by other deubiquitinases. Here we show that the deubiquitination activity of SAGA is required for full activation of SAGA-dependent inducible genes. Interestingly, the reduction of the SAGA deubiquitination activity and the parallel increase in H2B ubiquitation at inducible target genes before activation do not induce aberrant gene expression. Our data together indicate that different dynamic equilibriums of H2B ubiquitination/deubiquitination are established at different gene regulatory elements and that H2B ubiquitination changes are necessary but not sufficient to trigger parallel activation of gene expression.