Endocytosis is a fundamental membrane trafficking event that occurs in all eukaryotes. The yeast Saccharomyces cerevisiae has been particularly useful in efforts to uncover novel proteins that mediate endocytosis, and many of these factors share similarity with proteins from higher eukaryotes. In the past two years, progress has centered on three major areas: modifications/signaling pathways that initiate or regulate internalization, protein complexes that are implicated in the internalization process, and factors that are involved in regulation of traffic through late endosomal compartments. As the parallels between the mechanisms employed in yeast and higher eukaryotes are further explored, new insights into the complex process of endocytosis should emerge.