After cell surface receptors are internalized for endocytosis, they are accurately sorted in endosomes. Some are recycled to the plasma membrane and others are downregulated by delivery to lysosomes. Evidence is rapidly accumulating that ubiquitination of cargo proteins acts as a sorting signal during endocytosis. Sorting devices that recognize ubiquitin are distributed to various compartments, probably acting in a concerted manner. Cholesterol is enriched in the plasma membrane and endosomes, and is involved in protein sorting by forming microdomains called lipid rafts. Ubiquitin and cholesterol hold the key to control the endocytic sorting, and they are likely acting cooperatively.