Despite a key role for dense core vesicles (DCVs) in neuronal function, there are major gaps in our understanding of DCV biogenesis. A genetic screen for Caenorhabditis elegans mutants with behavioral defects consistent with impaired DCV function yielded five mutations in UNC-108 (Rab2). A genetic analysis showed that unc-108 mutations impair a DCV function unrelated to neuropeptide release that, together with neuropeptide release, fully accounts for the role of DCVs in locomotion. An electron microscopy analysis of DCVs in unc-108 mutants, coupled with quantitative imaging of DCV cargo proteins, revealed that Rab2 acts in cell somas during DCV maturation to prevent the loss of soluble and membrane cargo. In Rab2 null mutants, two thirds of these cargoes move to early endosomes via a PI(3)P-dependent trafficking pathway, whereas aggregated neuropeptides are unaffected. These results reveal how neurons solve a challenging trafficking problem using the most highly conserved animal Rab.