The small GTPase Rab1 is required for vesicular traffic from the ER to the cis-Golgi compartment, and for transport between the cis and medial compartments of the Golgi stack. In the present study, we examine the role of guanine nucleotide dissociation inhibitor (GDI) in regulating the function of Rab1 in the transport of vesicular stomatitis virus glycoprotein (VSV-G) in vitro. Incubation in the presence of excess GDI rapidly (t1/2 < 30 s) extracted Rab1 from membranes, inhibiting vesicle budding from the ER and sequential transport between the cis-, medial-, and trans-Golgi cisternae. These results demonstrate a direct role for GDI in the recycling of Rab proteins. Analysis of rat liver cytosol by gel filtration revealed that a major pool of Rab1 fractionates with a molecular mass of approximately 80 kD in the form of a GDI-Rab1 complex. When the GDI-Rab1 complex was depleted from cytosol by use of a Rab1-specific antibody, VSV-G failed to exit the ER. However, supplementation of depleted cytosol with a GDI-Rab1 complex prepared in vitro from recombinant forms of Rab1 and GDI efficiently restored export from the ER, and transport through the Golgi stack. These results provide evidence that a cytosolic GDI-Rab1 complex is required for the formation of non-clathrin-coated vesicles mediating transport through the secretory pathway.