The intermediate compartment residing between the endoplasmic reticulum (ER) and the Golgi is now recognized to be a dynamic structure that captures cargo released from the ER in COPII vesicular carriers and promotes recycling by COPI vesicular carriers. These and other findings now provide compelling evidence for the importance of this intermediate in balancing anterograde and retrograde flow through the early secretory pathway and in the formation and maintenance of the Golgi stack.