Varp, a novel protein containing a VPS9 domain and ankyrin repeats, can function as a guanine nucleotide exchange factor (GEF) of Rab21. We previously reported that Varp plays an important role in the regulation of endosome dynamics. To further investigate the function of Varp, a yeast two-hybrid screen was performed and Rab38 was identified as a Varp-associated protein. We demonstrate that Varp physically interacts with Rab38, and preferentially binds to the active GTP-bound form of Rab38 both in vitro and in vivo. Furthermore, Varp was shown to be recruited to Rab38-positive organelles in an ankyrin-repeat 1 (ANK1)-dependent manner. Our data demonstrate that Varp is a potential effector of Rab38. Together with our previous study, we propose Varp serves as both an effector and a GEF by interacting with different Rabs in mammalian cells.