PINK1 and Parkin mutations lead to the early onset of Parkinson's disease. PINK1-mediated phosphorylation of ubiquitin (Ub), ubiquitin-like protein (NEDD8), and ubiquitin-like (Ubl) domain of Parkin activate autoinhibited Parkin E3 ligase. The mechanism of various phospho-Ubls' specificity and conformational changes leading to Parkin activation remain elusive. Herein, we show that compared to Ub, NEDD8 is a more robust binder and activator of Parkin. Structures and biophysical/biochemical data reveal specific recognition and underlying mechanisms of pUb/pNEDD8 and pUbl domain binding to the RING1 and RING0 domains, respectively. Also, pUb/pNEDD8 binding in the RING1 pocket promotes allosteric conformational changes in Parkin's catalytic domain (RING2), leading to Parkin activation. Furthermore, Parkinson's disease mutation K211N in the RING0 domain was believed to perturb Parkin activation due to loss of pUb binding. However, our data reveal allosteric conformational changes due to N211 that lock RING2 with RING0 to inhibit Parkin activity without disrupting pNEDD8/pUb binding.