Membrane trafficking plays a fundamental role in eukaryotic cell biology. Of the numerous known or predicted protein components of the plant cell trafficking system, only a relatively small subset have been characterized with respect to their biological roles in plant growth, development, and response to stresses. In this study, we investigated the subcellular localization and function of an Arabidopsis (Arabidopsis thaliana) small GTPase belonging to the RabE family. RabE proteins are phylogenetically related to well-characterized regulators of polarized vesicle transport from the Golgi apparatus to the plasma membrane in animal and yeast cells. The RabE family of GTPases has also been proposed to be a putative host target of AvrPto, an effector protein produced by the plant pathogen Pseudomonas syringae, based on yeast two-hybrid analysis. We generated transgenic Arabidopsis plants that constitutively expressed one of the five RabE proteins (RabE1d) fused to green fluorescent protein (GFP). GFP-RabE1d and endogenous RabE proteins were found to be associated with the Golgi apparatus and the plasma membrane in Arabidopsis leaf cells. RabE down-regulation, due to cosuppression in transgenic plants, resulted in drastically altered leaf morphology and reduced plant size, providing experimental evidence for an important role of RabE GTPases in regulating plant growth. RabE down-regulation did not affect plant susceptibility to pathogenic P. syringae bacteria; conversely, expression of the constitutively active RabE1d-Q74L enhanced plant defenses, conferring resistance to P. syringae infection.