Primary cilia are ubiquitous antenna-like organelles that mediate cellular signaling and represent hotspots for human diseases termed ciliopathies. How signaling subcompartments are established within the microtubule-based organelle, and for example support Hedgehog or cGMP signal transduction pathways, remains a central question. Here we show that a C. elegans salt-sensing receptor type guanylate cyclase, GCY-22, accumulates at a high concentration within the distal region of the cilium. This receptor uses DAF-25 (Ankmy2 in mammals) to cross the transition zone (TZ) membrane diffusion barrier in the proximal-most region of the ciliary axoneme. Targeting of GCY-22 to the ciliary tip is dynamic, requiring the cargo-mobilizing intraflagellar transport (IFT) system. Disruption of transit across the TZ barrier or IFT trafficking causes GCY-22 protein mislocalization and defects in the formation, maintenance, and function of the ciliary tip compartment required for chemotaxis to low NaCl concentrations. Together, our findings reveal how a previously undescribed cilium tip cGMP signaling compartment is established and contributes to the physiological function of a primary cilium. signaling domains, remains limited, however.Cilia use two mechanisms, a trafficking system and a diffusion barrier, that function together to regulate the trafficking of proteins into, within, and out of cilia. The main ciliary trafficking machinery, intraflagellar transport (IFT), facilitates bidirectional transport of cargo, including signaling proteins, from the base/foundation (basal body) to the tip of the axoneme 2 . Anterograde IFT to the tip relies on kinesins, and cytoplasmic dynein enables retrograde transport back 3,4 . Two IFT modules, subcomplexes-A and -B 5,6 , together with another module containing BBS proteins (BBSome) that is thought to bridge the subcomplexes, play essential roles in cargo transport 7,8 . The best-known IFT cargos are axoneme structure components, including tubulin 9,10 , but signaling proteins, like the TRPV channel subunits OSM-9 and OCR-2 in the nematode C. elegans, are also transported 11 . Additionally, several mammalian ciliary signaling proteins, namely the GPCR SSTR3 and Hedgehog signaling component SMO, traverse the cilium by both IFT and diffusion 12 .To help confine proteins to cilia, a subdomain immediately distal to the basal body, called the transition zone (TZ), acts as a diffusion barrier for both membrane and soluble proteins [13][14][15] . How the TZ acts with IFT or other trafficking systems to regulate the composition of the sensory organelle is not well understood 16,17 .