Tumor hypoxia is a major barrier to therapeutic intervention and disease-free survival. Cancer cells exploit an ancient hypoxia-response program mediated by the hypoxia-inducible transcription factors (HIF) 1 & 2 that promote angiogenesis, metastasis, and epithelial-to-mesenchymal transition. Interestingly, HIF-2 also participates in hypoxia-mediated cap-dependent translation initiation as a member of the eIF4FH complex which is an important axis for gene expression in solid tumors. Therefore, there is a need for characterization of the underlying biology of the HIF-s to develop anti-HIF therapeutic interventions. Interferon-stimulated gene 15 (ISG15) is a ubiquitin-like modifier implicated in inflammatory-mediated tumor progression that restricts HIF-1 trans-activity via proteasomal degradation in a negative feedback loop, however, ISG15’s interaction with HIF-2 remains uncharacterized. We identify HIF-2 as a substrate for ISG15 conjugation, and ISGylation disrupts formation of the eIF4FH complex on the 5’ m7-cap of mRNA via conjugation-dependent and -independent mechanisms. Surprisingly, ISGylation enhances the polyribosome association of eIF4FH factors isolated by sucrose density fractionation (polysome profiling) with no alterations to translation of select mRNA transcripts. Gene ontology enrichment analysis of hundreds of ISG15 substrates identified in published ISGylome datasets indicate a significant enrichment of functions related to ribonucleoprotein dynamics and stress granule formation. Polysome profiles of HCT116 cells overexpressing the ISGylation system and treated with puromycin, an inducer of stress granule formation, shows enhanced co-fractionation of eIF4FH-associated initiation factors with heavier polyribosome fractions despite translation arrest which is a classic indication of stress granule formation. Therefore, our results implicate ISGylation as a translation regulating pathway of HIF-2-dependent translation in hypoxia.