Post-translational modifications (PTMs) add a major degree of complexity to the proteome and are essential controllers of protein homeostasis. Amongst the hundreds of PTMs identified, ubiquitin and ubiquitin-like (UBL) modifications are recognized as key regulators of cellular processes through their ability to affect protein–protein interactions, protein stability, and thus the functions of their protein targets. Here, we focus on the most recently identified UBL, ubiquitin-fold modifier 1 (UFM1), and the machinery responsible for its transfer to substrates (UFMylation) or its removal (deUFMylation). We first highlight the biochemical peculiarities of these processes, then we develop on how UFMylation and its machinery control various intertwined cellular processes and we highlight some of the outstanding research questions in this emerging field.