Protein turnover and recycling is a prerequisite in all living organisms to maintain normal cellular physiology. Many bacteria are proteasome deficient but they possess typical protease enzymes for carrying out protein turnover. However, several groups of actinobacteria such as mycobacteria harbor both proteasome and proteases. In these bacteria, for cellular protein turnover the target proteins undergo post-translational modification referred as pupylation in which a small protein Pup (prokaryotic ubiquitin-like protein) is tagged to the specific lysine residues of the target proteins and after that those target proteins undergo proteasomal degradation. Thus, Pup serves as a degradation signal, helps in directing proteins toward the bacterial proteasome for a turnover. Although the Pup-proteasome system has a multifaceted role in environmental stresses, pathogenicity and regulation of cellular signaling, but the fate of all types of pupylation such as mono and polypupylation on the proteins is still not completely understood. In this review, we present the mechanisms involved in the activation and conjugation of Pup to the target proteins, describing the structural sketch of pupylation and fundamental differences between the eukaryotic ubiquitin-proteasome and bacterial Pup-proteasome systems. We are also presenting a concise classification and cataloging of the complete battery of experimentally identified Pup-substrates from various species of actinobacteria.