Dysferlin and Caveolin-3 are plasma membrane proteins associated with muscular dystrophy. Patients with mutations in the CAV3 gene show dysferlin mislocalization in muscle cells. By utilizing caveolin-null cells, expression of caveolin mutants, and different mutants of dysferlin, we have dissected the site of action of caveolin with respect to dysferlin trafficking pathways. We now show that Caveolin-1 or -3 can facilitate exit of a dysferlin mutant that accumulates in the Golgi complex of Cav1 ؊/؊ cells. In contrast, wild type dysferlin reaches the plasma membrane but is rapidly endocytosed in Cav1 ؊/؊ cells. We demonstrate that the primary effect of caveolin is to cause surface retention of dysferlin. Caveolin-1 or Caveolin-3, but not specific caveolin mutants, inhibit endocytosis of dysferlin through a clathrin-independent pathway colocalizing with internalized glycosylphosphatidylinositol-anchored proteins. Our results provide new insights into the role of this endocytic pathway in surface remodeling of specific surface components. In addition, they highlight a novel mechanism of action of caveolins relevant to the pathogenic mechanisms underlying caveolin-associated disease.Dysferlin and Caveolin-3 (muscle-specific caveolin, Cav3) are sarcolemmal proteins whose role in muscle has gained clinical attention because mutations in their genes are associated with a number of muscle pathologies. Patients with mutations in the dysferlin (DYSF) gene develop disorders such as limb girdle muscular dystrophy type 2B, miyoshi myopathy, and distal myopathy (1-5). Whereas disruption in the Caveolin-3 (CAV3) gene has been linked to limb girdle muscular dystrophy 1C, Rippling muscle diseases, hyperCKemia, and distal myopathy among other myopathies (6 -15). Dysferlin and Cav3 have been co-purified from muscle cells (16,17) and shown to localize to adjacent membrane domains at the surface in mature muscle fibers (18). Moreover, dysferlin is depleted from the plasma membrane (PM) 2 when Cav3 is mutated (8,9,14,17,19). We have recently demonstrated a role for caveolin in dysferlin localization at the PM (18). However, the interplay of dysferlin and caveolin membrane trafficking dynamics remains to be examined.Dysferlin belongs to the ferlin family of proteins comprising otoferlin, myoferlin, and fer1L3 (20 -22). The DYSF gene encodes a 230-kDa skeletal muscle membrane protein (2, 5, 23) with homology to the Caenorhabditis elegans sperm-vesicle fusion factor, fer-1 (2). Because of this dysferlin has been suggested to play a role in vesicle fusion in skeletal muscle (2, 24). Moreover, in the absence of dysferlin muscle cells show defective resealing of membrane disruptions (25). Dysferlin has a single transmembrane domain at the C terminus and a long N-terminal cytoplasmic region containing six C2 domains. C2 domains are a common feature of the synaptotagmin family of proteins implicated in vesicular traffic and membrane fusion events through calcium-dependent interactions with phospholipids and proteins (26 -29). Interestingly, ...