BAR domains are protein modules that bind to membranes and promote membrane curvature. One type of BAR domain, the N-BAR domain, contains an additional N-terminal amphipathic helix, which contributes to membrane-binding and bending activities. The only known N-BAR-domain proteins in the budding yeast Saccharomyces cerevisiae, Rvs161 and Rvs167, are required for endocytosis. We have explored the mechanism of N-BAR-domain function in the endocytosis process using a combined biochemical and genetic approach. We show that the purified Rvs161-Rvs167 complex binds to liposomes in a curvature-independent manner and promotes tubule formation in vitro. Consistent with the known role of BAR domain polymerization in membrane bending, we found that Rvs167 BAR domains interact with each other at cortical actin patches in vivo. To characterize N-BAR-domain function in endocytosis, we constructed yeast strains harboring changes in conserved residues in the Rvs161 and Rvs167 N-BAR domains. In vivo analysis of the rvs endocytosis mutants suggests that Rvs proteins are initially recruited to sites of endocytosis through their membrane-binding ability. We show that inappropriate regulation of complex sphingolipid and phosphoinositide levels in the membrane can impinge on Rvs function, highlighting the relationship between membrane components and N-BAR-domain proteins in vivo.