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Two new members (Sar1a and Sar1b) of the SAR1 gene family have been identified in mammalian cells. Using immunoelectron microscopy, Sar1 was found to be restricted to the transitional region where the protein was enriched 20-40-fold in vesicular carriers mediating ER to Golgi traffic. Biochemical analysis revealed that Sar1 was essential for an early step in vesicle budding. A Sar1-specific antibody potently inhibited export of vesicular stomatitis virus glycoprotein (VSV-G) from the ER in vitro. Consistent with the role of guanine nucleotide exchange in Sar1 function, a trans-dominant mutant (Sar1a[T39N]) with a preferential affinity for GDP also strongly inhibited vesicle budding from the ER. In contrast, Sar1 was not found to be required for the transport of VSV-G between sequential Golgi compartments, suggesting that components active in formation of vesicular carriers mediating ER to Golgi traffic may differ, at least in part, from those involved in intra-Golgi transport. The requirement for novel components at different stages of the secretory pathway may reflect the recently recognized differences in protein transport between the Golgi stacks as opposed to the selective sorting and concentration of protein during export from the ER.