It has long been known that lipids are responsible for the structural integrity of biological membranes, and confer specific dynamic properties to the bilayer. However, they have often been considered as passive components of the membrane, beyond their well-known function as second messengers in signal transduction pathways. Evidence has been accumulating that lipids are sorted along the routes of membrane traffic, and that they are directly involved in the regulation of protein sorting and membrane flow. In this review, we will discuss recent studies on the organization and possible functions of lipids in the endocytic pathway. Copyright 1998 Academic Press.