In Drosophila, the sensory organ precursor (SOP or pI cell) divides asymmetrically to give birth to daughter cells, the fates of which are governed by the differential activation of the Notch pathway. Proteolytic activation of Notch induced by ligand is based on the correct polarized sorting and localization of the Notch ligand Delta, the Notch receptor and its trafficking partner Sanpodo (Spdo). Here, we have identified Stratum (Strat), a presumptive guanine nucleotide exchange factor for Rab GTPases, as a regulator of Notch activation. Loss of Strat causes cell fate transformations associated with an accumulation of Notch, Delta and Spdo in the trans-Golgi network (TGN), and an apical accumulation of Spdo. The strat mutant phenotype is rescued by the catalytically active as well as the wild-type form of Rab8, suggesting a chaperone function for Strat rather than that of exchange factor. Strat is required to localize Rab8 at the TGN, and rab8 phenocopies strat We propose that Strat and Rab8 act at the exit of the Golgi apparatus to regulate the sorting and the polarized distribution of Notch, Delta and Spdo.