The proteasome is a large multicatalytic complex conserved across eukaryotes that regulates multiple cellular processes through the degradation of ubiquitinated proteins. The proteasome is predominantly localized to the nucleus in proliferating cells and translocates to the cytoplasm in the stationary phase. Sts1 reportedly plays a vital role in the nuclear import of the proteasome during proliferation in yeast Saccharomyces cerevisiae. However, the mechanisms underlying cytoplasmic translocation of the proteasome in the stationary phase remain unknown. Here, we showed that the ubiquitin ligase Hul5 promotes vacuolar sequestration of Sts1 in a catalytic activity-dependent manner and thus suppresses the nuclear import of the proteasome during the stationary phase. We further demonstrated that cytoplasmic translocation of the proteasome plays a vital role in the clearance of ubiquitinated protein aggregates, mitochondrial quality control, and resuming proliferation from cellular quiescence. Our results provide insights into the mechanisms and significance of the cytoplasmic localization of proteasomes in cellular quiescence.