Glycosylphosphatidylinositol (GPI) anchoring is important for the function of several proteins in the context of their membrane trafficking pathways. We have shown previously that endocytosed GPI-anchored proteins (GPI-APs) are recycled to the plasma membrane three times more slowly than other membrane components. Recently, we found that GPI-APs are delivered to endocytic organelles, devoid of markers of the clathrin-mediated pathway, prior to their delivery to a common recycling endosomal compartment (REC). Here we show that the rate-limiting step in the recycling of GPI-APs is their slow exit from the REC; replacement of the GPI anchor with a transmembrane protein sequence abolishes retention in this compartment. Depletion of endogenous sphingolipid levels using sphingolipid synthesis inhibitors or in a sphingolipid-synthesis mutant cell line specifically enhances the rate of endocytic recycling of GPI-APs to that of other membrane components. We have shown previously that endocytic retention of GPI-APs is also relieved by cholesterol depletion. These findings strongly suggest that functional retention of GPI-APs in the REC occurs via their association with sphingolipid and cholesterol-enriched sorting platforms or 'rafts'.