Membrane trafficking pathways must be exquisitely coordinated at synaptic terminals to maintain functionality, particularly during conditions of high activity. We have generated null mutations in the Drosophila homolog of pallidin, a central subunit of the biogenesis of lysosome-related organelles complex-1 (BLOC-1), to determine its role in synaptic development and physiology. We find that Pallidin localizes to presynaptic microtubules and cytoskeletal structures, and that the stability of Pallidin protein is highly dependent on the BLOC-1 components Dysbindin and Blos1. We demonstrate that the rapidly recycling vesicle pool is not sustained during high synaptic activity in pallidin mutants, leading to accelerated rundown and slowed recovery. Following intense activity, we observe a loss of early endosomes and a concomitant increase in tubular endosomal structures in synapses without Pallidin. Together, our data reveal that Pallidin subserves a key role in promoting efficient synaptic vesicle recycling and re-formation through early endosomes during sustained activity.