The movement of proteins through the secretory pathway involves their orderly progression through a series of membranous compartments (66). Transport between successive secretory compartments appears to be mediated by vesicles that bud from one compartment and fuse with the next (60, 77). Progress has been made in the past few years in our understanding of the vesicle machinery and the mechanisms regulating the directionality and specificity of vesicle targeting and fusion. Over the last 10 years, the Ypt/Rab family of small GTPases has been shown to play an important role in vesicular trafficking in both yeast and mammalian cells (22, 63, 109). It has been suggested that these proteins act at the different steps of the secretory pathway to ensure the fidelity of vesicular targeting (10, 49, 88, 90). However, the specific mechanism by which Ypt/Rab proteins regulate vesicular trafficking is still unknown. The ability of Ypt/Rab proteins to cycle between GTP- and GDP-bound forms is thought to be crucial for their function (11, 28, 60, 67). Conversion from the GDP- to the GTP-bound form is achieved by nucleotide exchange, while the shift from the GTP- to the GDP-bound form is accomplished by the endogenous GTPase activity of these proteins. Most GTP-binding proteins have slow intrinsic rates of GTP hydrolysis and nucleotide exchange and thus require accessory factors to stimulate these reactions. Factors that stimulate guanine nucleotide exchange (guanine nucleotide exchange factor [GNEF]) (17, 18, 100, 102) and GTP hydrolysis (GTPase-activating protein [GAP]) (16, 17, 25, 40, 94, 95, 99, 108) have been identified for Rab proteins, but their role in vesicular transport is not clear. In addition, a protein that inhibits GDP dissociation (GDI) has also been identified as a Rab accessory factor. GDI is believed to be involved in recycling of Rab proteins, in their GDP-bound form, between membranes after each round of vesicle fusion (4, 91). Finally, GDI displacement factor (20) has been recently suggested to have a role in Ypt/Rab protein recruitment to the membrane. The following hypothesis has been advanced to explain how guanine nucleotide exchange and hydrolysis regulate the function of Ypt/Rab proteins: (i) nucleotide exchange stimulated by GNEF is coupled to membrane localization of Rab proteins to the donor (or vesicle) compartment; and (ii) GTP hydrolysis, stimulated by GAP, is important for vesicle fusion with the acceptor compartment (28, 60). At present, there is little evidence for the second part of this hypothesis. A recent alternative suggestion for the role of GTP hydrolysis proposes that the GTPase activity is not required for Ypt/Rab-mediated membrane fusion but rather acts as a timer for this fusion (78). These two alternative models for the role of GTP hydrolysis have arisen from two lines of investigation: the cloning and disruption of GAP genes (see below), and the use of mutations in Ypt/Rab proteins that impair GTP hydrolysis (see Discussion). Our results do not support either of these views but rather suggest a different model in which the GTPase activity of Ypt/Rab proteins is not essential for membrane fusion or its timing but may be required for the recycling of these proteins between compartments. If the GTPase activity of Ypt/Rab proteins is not crucial for their function, the GAP factors that regulate GTP hydrolysis are also not likely to be essential for Ypt/Rab function. While factors that regulate GTP hydrolysis for Ras and Rho have been identified and characterized (for a review, see reference 54), comparatively little is known about GAPs for Ypt/Rab GTPases. GAP activity was detected in mammalian and yeast cell extracts by using different Ypt/Rab proteins, including Ypt1p and Sec4p (16, 17, 40, 95). In the yeast Saccharomyces cerevisiae, Gyp6p and Gyp7p are GAPs that act on Ypt6p and Ypt7p, respectively (94, 99). Ypt6p is suggested to function in vacuolar protein sorting (94) or transport within the Golgi complex (48), and Ypt7p functions in endocytosis and homotypic vacuole fusion (53, 106). The GYP6 and GYP7 gene products do not have homology with each other or with other GAPs specific for Ras and Rho. Deletion or overexpression of GYP6 has no effect on cell growth. However, since neither YPT6 nor YPT7 is an essential gene, these results leave open the question of whether GAPs are necessary for the function of essential Ypt/Rab proteins. In this work, we studied the role of GTP hydrolysis in the function of Ypt1p during vesicular transport. Ypt1p, a member of the Ypt/Rab family of GTPases, has an essential function in the regulation of endoplasmic reticulum (ER)-to-Golgi and intra-Golgi transport in the yeast secretory pathway (5, 39, 74, 86, 88). To determine the consequence of preventing GTP hydrolysis by Ypt1p, we created a Q67L mutation; the corresponding residue in Ras is important for GTP hydrolysis (19, 24, 45, 55, 65, 82). To study the effect of this mutation on intrinsic and stimulated GTP hydrolysis, we developed a GTP hydrolysis assay and partially characterized a GAP activity for Ypt1p (75). The ypt1-Q67L mutation causes a severe block in GTP hydrolysis. However, this mutation confers only a minor defect in secretion and cell growth, suggesting that GTP hydrolysis is not essential for Ypt1p function. In addition, using the ypt1-Q67L mutation, we found that being in the GTP-bound form is not sufficient for Ypt1p function in protein transport. We suggest that Ypt1p must interact with its GNEF even if it is loaded with GTP.