Posttranslational modifications enhance the functional diversity of the proteome by modifying the substrates. The UFM1 cascade is a novel ubiquitin-like modification system. The mutations in UFM1, its E1 (UBA5) and E2 (UFC1), have been identified in patients with microcephaly. However, its pathological mechanisms remain unclear. Herein, we observed the disruption of the UFM1 cascade in Drosophila neuroblasts (NBs) decreased the number of NBs, leading to a smaller brain size. The lack of ufmylation in NBs resulted in an increased mitotic index and an extended G2/M phase, indicating a defect in mitotic progression. In addition, live imaging of the embryos revealed an impaired E3 ligase (Ufl1) function resulted in premature entry into mitosis and failed cellularization. Even worse, the embryonic lethality occurred as early as within the first few mitotic cycles following the depletion of Ufm1. Knockdown of ufmylation in the fixed embryos exhibited severe phenotypes, including detached centrosomes, defective microtubules, and DNA bridge. Furthermore, we observed that the UFM1 cascade could alter the level of phosphorylation on tyrosine-15 of CDK1 (pY15-CDK1), which is a negative regulator of the G2 to M transition. These findings yield unambiguous evidence suggesting that the UFM1 cascade is a microcephaly-causing factor that regulates the progression of the cell cycle at mitosis phase entry.