Histone deubiquitinating component of the transcription regulatory histone acetylation (HAT) complex SAGA. Catalyzes the deubiquitination of both histones H2A and H2B, thereby acting as a coactivator. Recruited to specific gene promoters by activators, where it is required for transcription (By similarity). Thiol-dependent hydrolysis of ester, thioester, amide, peptide and isopeptide bonds formed by the C-terminal Gly of ubiquitin (a 76-residue protein attached to proteins as an intracellular targeting signal). Component of some SAGA transcription coactivator-HAT complexes. Belongs to the peptidase C19 family. UBP8 subfamily.