Summary Background Phosphatidylserine (PS) normally confined to the cytoplasmic leaflet of plasma membrane (PM) is externalized to the exoplasmic leaflet (exPS) during apoptosis, where it serves as an “eat-me” signal to phagocytes. In addition, some living cells such as macrophages also express exPS. Results A secreted Annexin V (sAnxV::GFP) PS sensor reveals that exPS appears early on apoptotic cells in C. elegans embryos and decreases in older or unengulfed apoptotic cells. This decrease in exPS expression is blocked by loss of CED-7, an ATP binding cassette (ABC) transporter, or TTR-52, a secreted PS binding protein. Phagocytic cells also express exPS, which is dependent on the activity of CED-7, TTR-52, and TTR-52-interacting phagocyte receptor CED-1. Interestingly, a secreted lactadherin PS sensor (sGFP::LactC1C2) labels apoptotic cells but not phagocytes, prevents sAnxV::GFP from labeling phagocytes, and compromises phagocytosis. Immuno-electron micrographs of embryos expressing sAnxV::GFP or sGFP::LactC1C2 reveal the presence of extracellular PS-containing vesicles between the apoptotic cell and neighboring cells, which are absent or greatly reduced in the ced-7 and ttr-52 mutants, respectively, indicating that CED-7 and TTR-52 promote the generation of extracellular PS vesicles. Loss of the tat-1 gene, which maintains PS asymmetry in the PM, restores phagocyte exPS expression in ced-1, ced-7, and ttr-52 mutants and partially rescues their engulfment defects. Conclusions CED-7 and TTR-52 may promote the efflux of PS from apoptotic cells through the generation of extracellular PS vesicles, which lead to exPS expression on phagocytes via TTR-52 and CED-1 to facilitate cell corpse clearance.