Coronaviruses (CoVs) are a large family of respiratory viruses which can cause mild to moderate upper respiratory tract infections. Recently, new coronavirus named as Severe acute respiratory syndrome coronavirus 2 (SARS‐CoV‐2) has been identified which is a major threat to public health. Innate immune responses play a vital role in a host’s defense against viruses. Interestingly, CoVs have evolved elaborate strategies to evade the complex system of sensors and signaling molecules to suppress host immunity. SARS‐CoV‐2 papain‐like protease (PLpro), as an important coronavirus enzyme, regulates viral spread and innate immune responses. SCoV‐2 PLpro is multifunctional enzymes with deubiquitinating (DUB) and deISGylating activity. The PLpro can interact with key regulators in signaling pathways such as STING, NF‐κB, cytokine production, MAPK, and TGF‐β and hijack those to block the immune responses. Therefore, the PLpro can be as an important target for the treatment of COVID‐19. Until now, there are several drugs or compound have been identified that can inhibit PLpro activity. Here we discuss about the dysregulation effects of PLpro on immune system and drugs that have potential inhibitors for SCoV‐2 PLpro.