Once loaded onto Argonaute proteins, microRNAs form a silencing complex called miRISC that targets mostly the 3'UTR of mRNAs to silence their translation. How microRNAs are transported to and from their target mRNA remains poorly characterized. While some reports linked intracellular trafficking to microRNA activity, it is still unclear how these pathways coordinate for proper microRNA-mediated gene silencing and turnover. Through a forward genetic screen using Caenorhabditis elegans, we identified the RabGAP tbc-11 as an important factor for the microRNA pathway. We show that TBC-11 acts mainly through the small GTPase RAB-6 and that its regulation is required for microRNA function. The absence of functional TBC-11 increases the pool of microRNA-unloaded Argonaute ALG-1 that is likely associated to endomembranes. Furthermore, in this condition, this pool of Argonaute accumulates in a perinuclear region and forms a high molecular weight complex. Altogether, our data suggest that the alteration of TBC-11 generates a fraction of ALG-1 that cannot bind to target mRNAs, leading to defective gene repression. Our results establish the importance of intracellular trafficking for microRNA function and demonstrate the involvement of a small GTPase and its GAP in proper Argonaute localization in vivo.