In the budding yeast Saccharomyces cerevisiae, PHO84 and PHO86 are among the genes that are most highly induced in response to phosphate starvation. They are essential for growth when phosphate is limiting, and they function in the high-affinity phosphate uptake system. PHO84 encodes a high-affinity phosphate transporter, and mutations in PHO86 cause many of the same phenotypes as mutations in PHO84, including a phosphate uptake defect and constitutive expression of the secreted acid phosphatase, Pho5p. Here, we show that the subcellular localization of Pho84p is regulated in response to extracellular phosphate levels; it is localized to the plasma membrane in low-phosphate medium but quickly endocytosed and transported to the vacuole upon addition of phosphate to the medium. Moreover, Pho84p is localized to the endoplasmic reticulum (ER) and fails to be targeted to the plasma membrane in the absence of Pho86p. Utilizing an in vitro vesicle budding assay, we demonstrate that Pho86p is required for packaging of Pho84p into COPII vesicles. Pho86p is an ER resident protein, which itself is not transported out of the ER. Interestingly, the requirement of Pho86p for ER exit is specific to Pho84p, because other members of the hexose transporter family to which Pho84 belongs are not mislocalized in the absence of Pho86p.