Dominant-negative mutations can help to investigate the biological mechanisms and to understand the selective pressures for multifunctional proteins. However, most studies have focused on recessive mutant effects that occur in the absence of a second functional gene copy, which overlooks the fact that most eukaryotic genomes contain more than one copy of many genes. We have identified dominant effects on yeast growth rate among all possible point mutations in ubiquitin expressed alongside a wild-type allele. Our results reveal more than 400 dominant-negative mutations, indicating that dominant-negative effects make a sizable contribution to selection acting on ubiquitin. Cellular and biochemical analyses of individual ubiquitin variants show that dominant-negative effects are explained by varied accumulation of polyubiquitinated cellular proteins and/or defects in conjugation of ubiquitin variants to ubiquitin ligases. Our approach to identify dominant-negative mutations is general and can be applied to other proteins of interest. Display omitted •Overexpression of inducible variants alongside functional wild-type ubiquitin•Numerous dominant-negative mutations are enriched throughout the ubiquitin protein•Dominant mutations exert balancing selection on ubiquitin and polyubiquitin levels•Versatile method to identify dominant-negative mutations in protein of interest Padhy et al. employed inducible variant overexpression alongside functional wild-type ubiquitin to investigate the dominant mutant effects underlying its functions. The results show widespread prevalence of dominant mutations associated with altered polyubiquitination, underscoring their critical role in cellular ubiquitination and limiting impacts on ubiquitin evolution.