ZNF313 encoding a zinc-binding protein is located at chromosome 20q13.13, which exhibits a frequent genomic amplification in multiple human cancers. However, the biological function of ZNF313 remains largely undefined. Here we report that ZNF313 is an ubiquitin E3 ligase that has a critical role in the regulation of cell cycle progression, differentiation and senescence. In this study, ZNF313 is initially identified as a XIAP-associated factor 1 (XAF1)-interacting protein, which upregulates the stability and proapoptotic effect of XAF1. Intriguingly, we found that ZNF313 activates cell cycle progression and suppresses cellular senescence through the RING domain-mediated degradation of p21(WAF1). ZNF313 ubiquitinates p21(WAF1) and also destabilizes p27(KIP1) and p57(KIP2), three members of the CDK-interacting protein (CIP)/kinase inhibitor protein (KIP) family of cyclin-dependent kinase inhibitors, whereas it does not affect the stability of the inhibitor of CDK (INK4) family members, such as p16(INK4A) and p15(INK4B). ZNF313 expression is tightly controlled during the cell cycle and its elevation at the late G1 phase is crucial for the G1-to-S phase transition. ZNF313 is induced by mitogenic growth factors and its blockade profoundly delays cell cycle progression and accelerates p21(WAF1)-mediated senescence. Both replicative and stress-induced senescence are accompanied with ZNF313 reduction. ZNF313 is downregulated during cellular differentiation process in vitro and in vivo, while it is commonly upregulated in many types of cancer cells. ZNF313 shows both the nuclear and cytoplasmic localization in epithelial cells of normal tissues, but exhibits an intense cytoplasmic distribution in carcinoma cells of tumor tissues. Collectively, ZNF313 is a novel E3 ligase for p21(WAF1), whose alteration might be implicated in the pathogenesis of several human diseases, including cancers.