Phosphoinositides play important roles in downregulation of growth factor receptors, such as the epidermal growth factor receptor (EGFR), through regulation of membrane transport and multivesicular body (MVB) biogenesis. Phosphatidylinositol-3-phosphate (PI(3)P) is required for the formation of intraluminal vesicles in MVBs and sorting of EGFR into these vesicles by recruiting PI(3)P binding effector proteins, such as Hrs. Another candidate effector of PI(3)P is the PI(3)P binding PI(3)P 5-kinase, FAB1, that synthesises one of the least studied phosphoinositides, PI(3,5)P2, from PI(3)P. In yeast both Vps27 (Hrs) and Fab1 are necessary for correct membrane trafficking, and display morphological defects, such as enlarged vacuoles when mutated. We describe the isolation and characterisation of the Drosophila melanogaster FAB1 gene (termed fab1) and its mutants. The fab1 gene encodes a protein of 1809 amino acids with similar domain architecture as in other eucaryotes. Immunolocalisation of the Fab1 protein shows colocalisation with Rab5, a marker for early endosomes (EEs), FYVE, a marker for EEs and MVBs and Rab7, a marker for MVBs. Analysis of fluid phase endocytosis revealed that fab1 mutant cells are larger than wild type cells with accompanying enlarged endocytic vesicles, and a block in endosome to lysosome fusion. Initial analysis of EGFR signalling in fab1 mutants did not reveal increased signalling activity. Further analysis is needed to investigate the potential role of Fab1 in receptor downregulation.