The Notch intercellular signalling pathway is important throughout development, and its components are modulated by a variety of cellular and molecular mechanisms. Ligand and receptor trafficking are tightly controlled,although context-specific regulation of this is incompletely understood. We show that during sense organ precursor specification in Drosophila,the cell adhesion molecule Echinoid colocalises extensively with the Notch ligand, Delta, at the cell membrane and in early endosomes. Echinoid facilitates efficient Notch pathway signalling. Cultured cell experiments suggest that Echinoid is associated with the cis-endocytosis of Delta, and is therefore linked to the signalling events that have been shown to require such Delta trafficking. Consistent with this, overexpression of Echinoid protein causes a reduction in Delta level at the membrane and in endosomes. In vivo and cell culture studies suggest that homophilic interaction of Echinoid on adjacent cells is necessary for its function.