G protein-gated potassium (Kir3) channels are important for controlling neuronal excitability in the brain. Using a proteomics approach, we have identified a unique rodent intracellular protein, sorting nexin 27 (SNX27), which regulates the trafficking of Kir3 channels. Like most sorting nexins, SNX27 possesses a functional PX domain that selectively binds the membrane phospholipid phosphatidylinositol-3-phosphate (PI3P) and is important for trafficking to the early endosome. SNX27, however, is the only sorting nexin to contain a PDZ domain. This PDZ domain discriminates between channels with similar class I PDZ-binding motifs, associating with the C-terminal end of Kir3.3 and Kir3.2c (-ESKV), but not with that of Kir2.1 (-ESEI) or Kv1.4 (-ETDV). SNX27 promotes the endosomal movement of Kir3 channels, leading to reduced surface expression, increased degradation and smaller Kir3 potassium currents. The regulation of endosomal trafficking via sorting nexins reveals a previously unknown mechanism for controlling potassium channel surface expression.