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Rab5 and rab7 proteins belong to a superfamily of small molecular weight GTPases known to be associated with early and late endosomes, respectively. The rab5 protein plays an important regulatory role in early endocytosis, yet the function of rab7 protein was previously uncharacterized. This question was addressed by comparing the kinetics of vesicular stomatitis virus (VSV) G protein internalization in baby hamster kidney cells overexpressing wild-type or dominant negative mutant forms of the rab7 protein (rab7N125I and rab7T22N). Overexpression of wild-type rab7 protein allowed normal transport to late endosomes (mannose 6-phosphate receptor positive), while the rab7N125I mutant caused the VSV G protein to accumulate specifically in early (transferrin receptor positive) endosomes. Horseradish peroxidase and paramyxovirus SV5 hemagglutinin-neuraminidase (HN) were used in quantitative biochemical assays to further demonstrate that rab7 function was not required for early internalization events, but was crucial in downstream degradative events. The characteristic cleavage of SV5 HN in the late endosome distinguishes internalization from transport to later stages of the endocytic pathway. Mutant rab7N125I or rab7T22N proteins had no effect on the internalization of either horseradish peroxidase or SV5 HN protein. In contrast, the mutant proteins markedly inhibited the subsequent cleavage of the SV5 HN protein. Taken together, these data support a key role for rab7, downstream of rab5, in regulating membrane transport leading from early to late endosomes. We compare our findings to those obtained for the yeast homologues Ypt51p, Ypt52p, Ypt53p, and Ypt7p.