Asymmetric division of sensory organ precursors (SOPs) in Drosophila generates different cell types of the mature sensory organ. In a genetic screen designed to identify novel players in this process, we have isolated a mutation in Drosophila sec15, which encodes a component of the exocyst, an evolutionarily conserved complex implicated in intracellular vesicle transport. sec15(-) sensory organs contain extra neurons at the expense of support cells, a phenotype consistent with loss of Notch signaling. A vesicular compartment containing Notch, Sanpodo, and endocytosed Delta accumulates in basal areas of mutant SOPs. Based on the dynamic traffic of Sec15, its colocalization with the recycling endosomal marker Rab11, and the aberrant distribution of Rab11 in sec15 clones, we propose that a defect in Delta recycling causes cell fate transformation in sec15(-) sensory lineages. Our data indicate that Sec15 mediates a specific vesicle trafficking event to ensure proper neuronal fate specification in Drosophila.