Endo-lysosomal compartments exchange proteins by fusing, fissioning, and through endosomal transport carriers. Thereby, they sort many plasma membrane receptors and transporters and control cellular signaling and metabolism. How the membrane fission events are catalyzed is poorly understood. Here, we identify the novel CROP complex as a factor acting at this step. CROP joins members of two protein families: the peripheral subunits of retromer, a coat forming endosomal transport carriers, and membrane inserting PROPPINs. Integration into CROP potentiates the membrane fission activity of the PROPPIN Atg18 on synthetic liposomes and confers strong preference for binding PI(3,5)P ₂ , a phosphoinositide required for membrane fission activity. Disrupting CROP blocks fragmentation of lysosome-like yeast vacuoles in vivo. CROP-deficient mammalian endosomes accumulate micrometer-long tubules and fail to export cargo, suggesting that carriers attempt to form but cannot separate from these organelles. PROPPINs compete for retromer binding with the SNX-BAR proteins, which recruit retromer to the membrane during the formation of endosomal carriers. Transition from retromer-SNX-BAR complexes to retromer-PROPPIN complexes might hence switch retromer activities from cargo capture to membrane fission.