After endocytosis, membrane proteins are often sorted between two alternative pathways: a recycling pathway and a degradation pathway. Relatively little is known about how trafficking through these alternative pathways is differentially regulated. Here, we identify UNC-108/Rab2 as a regulator of postendocytic trafficking in both neurons and coelomocytes. Mutations in the Caenorhabditis elegans Rab2 gene unc-108, caused the green fluorescent protein (GFP)-tagged glutamate receptor GLR-1 (GLR-1::GFP) to accumulate in the ventral cord and in neuronal cell bodies. In neuronal cell bodies of unc-108/Rab2 mutants, GLR-1::GFP was found in tubulovesicular structures that colocalized with markers for early and recycling endosomes, including Syntaxin-13 and Rab8. GFP-tagged Syntaxin-13 also accumulated in the ventral cord of unc-108/Rab2 mutants. UNC-108/Rab2 was not required for ubiquitin-mediated sorting of GLR-1::GFP into the multivesicular body (MVB) degradation pathway. Mutations disrupting the MVB pathway and unc-108/Rab2 mutations had additive effects on GLR-1::GFP levels in the ventral cord. In coelomocytes, postendocytic trafficking of the marker Texas Red-bovine serum albumin was delayed. These results demonstrate that UNC-108/Rab2 regulates postendocytic trafficking, most likely at the level of early or recycling endosomes, and that UNC-108/Rab2 and the MVB pathway define alternative postendocytic trafficking mechanisms that operate in parallel. These results define a new function for Rab2 in protein trafficking.