Mice lacking the E3 ubiquitin ligase mahogunin ring finger‐1 (MGRN1) have a pleiotropic phenotype that includes spongiform neurodegeneration, embryonic patterning defects, and dark fur due to a defect in pigment‐type switching. The only MGRN1 ubiquitination target identified to date is tumor susceptibility gene 101 (TSG101), a component of the endosomal trafficking machinery. Here, we show that MGRN1 also interacts with but does not ubiquitinate NEDD4, a HECT‐domain ubiquitin ligase involved in endosomal trafficking. Using transgenesis in mice, we demonstrate that pigment‐type switching likely requires MGRN1′s ubiquitin ligase activity but not its ability to bind TSG101 or NEDD4. This indicates that MGRN1‐dependent ubiquitination of an as‐yet unidentified target protein is required for agouti‐mediated melanocortin signaling.