Exosomes, a type of small extracellular vesicles (sEVs), are secreted membrane vesicles that are derived from various cell types, including cancer cells, mesenchymal stem cells, and immune cells via multivesicular bodies (MVBs). These sEVs contain RNAs (mRNA, miRNA, lncRNA, and rRNA), lipids, DNA, proteins, and metabolites, all of which mediate cell-to-cell communication. This communication is known to be implicated in a diverse set of diseases such as cancers and their metastases and degenerative diseases. The molecular mechanisms, by which proteins are modified and sorted to sEVs, are not fully understood. Various cellular processes, including degradation, transcription, DNA repair, cell cycle, signal transduction, and autophagy, are known to be associated with ubiquitin and ubiquitin-like proteins (UBLs). Recent studies have revealed that ubiquitin and UBLs also regulate MVBs and protein sorting to sEVs. Ubiquitin-like 3 (UBL3)/membrane-anchored Ub-fold protein (MUB) acts as a post-translational modification (PTM) factor to regulate efficient protein sorting to sEVs. In this review, we focus on the mechanism of PTM by ubiquitin and UBLs and the pathway of protein sorting into sEVs and discuss the potential biological significance of these processes.