Activity-regulated cytoskeleton-associated protein (Arc/Arg3.1) is an immediate early gene that plays a vital role in learning and memory. The recent discovery that Arc mediates the inter-neuronal RNA transfer implies its role in regulating neuronal functions across long distances. Arc protein has structural and functional properties similar to viral Group-specific antigen (Gag). By assembling into high-order, virus-like capsids, Arc mediates the intercellular RNA transfer. However, the exact secretion pathway through which Arc capsids maneuver cargos is unclear. Here, we identified that Arc capsids assemble and secrete through the endosomal-multivesicular body (MVB) pathway. Arc's endosomal entry is likely mediated by phosphatidylinositol-3-phosphate (PI3P). Indeed, reconstituted Arc protein preferably binds to PI3P. In mammalian cells, Arc forms puncta that colocalizes with FYVE, an endosomal PI3P marker, and competitive binding to PI3P via prolonged FYVE expression reduces the average number of Arc puncta per cell. Overexpression of MTMR1, a PI3P phosphatase, significantly reduces Arc capsid secretion. Arc capsids secrete through the endosomal-MVB axis as extracellular vesicles. Live-cell imaging shows that fluorescently labeled Arc primarily colocalizes Rab5 and CD63, early endosomal and MVB markers, respectively. Superresolution imaging resolves Arc accumulates within the intraluminal vesicles of MVB. CRISPR double knockout of RalA and RalB, crucial GTPases for MVB biogenesis and exocytosis, severely reduces Arc-mediated RNA transfer efficiency. These results suggest that, unlike the Human Immunodeficiency Virus Gag, which assembles on and bud off from the plasma membrane, Arc capsids assemble at the endocytic membranes of the endosomal-MVB pathway mediated by PI3P. Understanding Arc's secretion pathway helps gain insights into its role in intercellular cargo transfer and highlights the commonality and distinction of trafficking mechanisms between structurally resembled capsid proteins.