Abstract: Fusion of organelles in the endomembrane system depends on Rab GTPases that interact with tethering factors before lipid bilayer mixing. In yeast, the Rab5 GTPase Vps21 controls fusion and membrane dynamics between early and late endosomes. Here we identify Msb3/Gyp3 as a specific Vps21 GTPase-activating protein (GAP). Loss of Msb3 results in an accumulation of Vps21 and one of its effectors Vps8, a subunit of the CORVET complex, at the vacuole membrane in vivo. In agreement, Msb3 forms a specific transition complex with Vps21, has the highest activity of all recombinant GAPs for Vps21 in vitro, and is found at vacuoles despite its predominant localization to bud tips and bud necks at the plasma membrane. Surprisingly, Msb3 also inhibits vacuole fusion, which can be rescued by the Ypt7 GDP-GTP exchange factor (GEF), the Mon1-Ccz1 complex. Consistently, msb3 vacuoles fuse more efficiently than wild-type vacuoles in vitro, suggesting that GAP can also act on Ypt7. Our data indicate that GAPs such as Msb3 can act on multiple substrates in vivo at both ends of a trafficking pathway. This ensures specificity of the subsequent GEF-mediated activation of the Rab that initiates the next transport event.