The small GTPase Rab1b is essential for endoplasmic reticulum (ER) to Golgi transport, but its exact function remains unclear. We have examined the effects of wild-type and three mutant forms of Rab1b in vivo. We show that the inactive form of Rab1b (the N121I mutant with impaired guanine nucleotide binding) blocks forward transport of cargo and induces Golgi disruption. The phenotype is analogous to that induced by brefeldin A (BFA): it causes resident Golgi proteins to relocate to the ER and induces redistribution of ER-Golgi intermediate compartment proteins to punctate structures. The COPII exit machinery seems to be functional in cells expressing the N121I mutant, but COPI is compromised, as shown by the release of β-COP into the cytosol. Our results suggest that Rab1b function influences COPI recruitment. In support of this, we show that the disruptive effects of N121I can be reversed by expressing known mediators of COPI recruitment, the GTPase ARF1 and its guanine nucleotide exchange factor GBF1. Further evidence is provided by the finding that cells expressing the active form of Rab1b (the Q67L mutant with impaired GTPase activity) are resistant to BFA. Our data suggest a novel role for Rab1b in ARF1- and GBF1-mediated COPI recruitment pathway.