Endocytosis regulates multiple cellular processes, including the protein composition of the plasma membrane, intercellular signaling, and cell polarity. We have identified the highly conserved protein Rush hour (Rush) and show that it participates in the regulation of endocytosis. Rush localizes to endosomes via direct binding of its FYVE (Fab1p, YOTB, Vac1p, EEA1) domain to phosphatidylinositol 3-phosphate. Rush also directly binds to Rab GDP dissociation inhibitor (Gdi), which is involved in the activation of Rab proteins. Homozygous rush mutant flies are viable but show genetic interactions with mutations in Gdi, Rab5, hrs, and carnation, the fly homologue of Vps33. Overexpression of Rush disrupts progression of endocytosed cargo and increases late endosome size. Lysosomal marker staining is decreased in Rush-overexpressing cells, pointing to a defect in the transition between late endosomes and lysosomes. Rush also causes formation of endosome clusters, possibly by affecting fusion of endosomes via an interaction with the class C Vps/homotypic fusion and vacuole protein-sorting (HOPS) complex. These results indicate that Rush controls trafficking from early to late endosomes and from late endosomes to lysosomes by modulating the activity of Rab proteins.