Cilia are endowed with membrane receptors, channels, and signaling components whose localization and function must be tightly controlled. In primary cilia of mammalian kidney epithelia and sensory cilia of Caenorhabditis elegans neurons, polycystin-1 (PC1) and transient receptor polycystin-2 channel (TRPP2 or PC2), function together as a mechanosensory receptor-channel complex. Despite the importance of the polycystins in sensory transduction, the mechanisms that regulate polycystin activity and localization, or ciliary membrane receptors in general, remain poorly understood. We demonstrate that signal transduction adaptor molecule STAM-1A interacts with C. elegans LOV-1 (PC1), and that STAM functions with hepatocyte growth factor-regulated tyrosine kinase substrate (Hrs) on early endosomes to direct the LOV-1-PKD-2 complex for lysosomal degradation. In a stam-1 mutant, both LOV-1 and PKD-2 improperly accumulate at the ciliary base. Conversely, overexpression of STAM or Hrs promotes the removal of PKD-2 from cilia, culminating in sensory behavioral defects. These data reveal that the STAM-Hrs complex, which down-regulates ligand-activated growth factor receptors from the cell surface of yeast and mammalian cells, also regulates the localization and signaling of a ciliary PC1 receptor-TRPP2 complex.