CUP is an eIF4E-binding protein (4E-BP) that represses the expression of specific maternal mRNAs prior to their posterior localization. Here, we show that CUP employs multiple mechanisms to repress the expression of target mRNAs. In addition to inducing translational repression, CUP maintains mRNA targets in a repressed state by promoting their deadenylation and protects deadenylated mRNAs from further degradation. Translational repression and deadenylation are independent of eIF4E binding and require both the middle and C-terminal regions of CUP, which collectively we termed the effector domain. This domain associates with the deadenylase complex CAF1–CCR4–NOT and decapping activators. Accordingly, in isolation, the effector domain is a potent trigger of mRNA degradation and promotes deadenylation, decapping and decay. However, in the context of the full-length CUP protein, the decapping and decay mediated by the effector domain are inhibited, and target mRNAs are maintained in a deadenylated, repressed form. Remarkably, an N-terminal regulatory domain containing a noncanonical eIF4E-binding motif is required to protect CUP-associated mRNAs from decapping and further degradation, suggesting that this domain counteracts the activity of the effector domain. Our findings indicate that the mode of action of CUP is more complex than previously thought and provide mechanistic insight into the regulation of mRNA expression by 4E-BPs.