Activated receptor tyrosine kinases recruit many signaling proteins to activate downstream cell proliferation and survival pathways, including phosphatidylinositol 3-kinase (PI3K) consisting of a p85 regulatory protein and a p110 catalytic protein. We have recently shown the p85alpha protein also has in vitro GTPase activating protein (GAP) activity towards Rab5 and Rab4, small GTPases that regulate vesicle trafficking events for activated receptors. Expression of a GAP-defective mutant, p85R274A, resulted in sustained levels of activated platelet-derived growth factor receptors (PDGFRs) and enhanced downstream signaling. In this report we have characterized Rab5- and Rab4-mediated PDGFR trafficking in cells expressing wild type p85 and GAP-defective mutant p85R274A. Wild type p85 overexpressing cells had slower PDGFR trafficking consistent with enhanced GAP activity deactivating Rab5 and Rab4 to block their vesicle trafficking functions. Mutant p85R274A expression increased the internalization rate of PDGFRs, a Rab5-dependent process, without preventing PDGFR ubiquitination. Immunofluorescence studies further demonstrated that p85R274A-expressing cells showed Rab5 accumulation at intracellular locations. Pull-down and FRAP (fluorescence recovery after photobleaching) experiments indicate this is likely membrane-associated Rab5-GTP, sustained due to decreased p85 GAP activity for the p85R274A mutant. These cells also had substantial amounts of activated PDGFRs in Rab4-positive recycling endosomes, a compartment that usually contains primarily deactivated/dephosphorylated receptors. Our results suggest that the PDGFR-associated GAP activity of p85 regulates both Rab5 and Rab4 functions in cells to influence the movement of activated PDGFR through endosomal compartments. Disruption of this regulation by p85R274A expression impacts PDGFR phosphorylation/dephosphorylation, degradation kinetics and downstream signaling by altering the time receptors spend in specific intracellular endosomal compartments. These results demonstrate that the p85alpha protein is an important regulator of Rab-mediated PDGFR trafficking, which significantly impacts receptor signaling and degradation.