The Retromer coat is conserved in all eukaryotes and is crucial for the correct intracellular sorting of many transmembrane receptors and lysosomal hydrolases. Retromer is an effector of the late endosomal small GTPase RAB7 and is also implicated in its inactivation required for proper endosomal maturation. Here, we explore the role of controlled GTP hydrolysis by the RAB7 ortholog Ypt7 in the formation of Retromer-coated membrane carriers in yeast. Proximity labelling and genetic ablation identify the GTPase Activating Protein (GAP) Gyp6 as a critical regulator of Ypt7 activity in the context or Retromer. Structural studies show that Retromer recruits Gyp6 through its Vps29 subunit, which recognises a specific PL motif and a secondary binding site in the C-terminal domain of Gyp6. This interaction does not occur with other yeast GAPs. Ablation of the Gyp6-Retromer interface or the catalytic activity of Gyp6 leads to the accumulation of tubular structures on endo-lysosomal compartments and to increased association of Ypt7 with Retromer and its cargo Vps10. These results support a model in which Gyp6 controls the switch from Ypt7-dependent Retromer coat assembly and cargo collection to the departure of the carrier through membrane fission and uncoating. ### Competing Interest Statement The authors have declared no competing interest. National Health and Medical Research Council, https://ror.org/011kf5r70, APP2016410 Swiss National Science Foundation, https://ror.org/00yjd3n13, 31003A_179306, 310030_204713, 10.006.083