MDM2 (HDM2) is a ubiquitin ligase that can target the p53 tumor suppressor protein for degradation. The RING domain is essential for the E3 activity of MDM2, and we show here that the extreme C‐terminal tail of MDM2 is also critical for efficient E3 activity. Loss of E3 function in MDM2 mutants deleted of the C‐terminal tail correlated with a failure of these mutants to oligomerize with MDM2, or with the related protein MDMX (HDMX). However, MDM2 containing point mutations within the C‐terminus that inactivated E3 function retained the ability to oligomerize with the wild‐type MDM2 RING domain and MDMX, and our results indicate that oligomers containing both wild‐type MDM2 and a C‐terminal mutant protein retain E3 function both in auto‐degradation and degradation of p53. Interestingly, the E3 activity of C‐terminal point mutants of MDM2 can also be supported by interaction with wild‐type MDMX, suggesting that MDMX can directly contribute to E3 function.