The biogenesis of peroxisomes is mediated by peroxins (PEXs). PEX7 is a cytosolic receptor that imports peroxisomal targeting signal type 2 (PTS2)-containing proteins. Although PEX7 is important for protein transport, the mechanisms that mediate its function are unknown. In this study, we performed proteomic analysis to identify PEX7-binding proteins using transgenic Arabidopsis expressing green fluorescent protein (GFP)-tagged PEX7. Our analysis identified RabE1c, a small GTPase, as a PEX7 binding partner. In vivo analysis revealed that GTP-bound RabE1c binds to PEX7 and that a subset of RabE1c localizes to peroxisomes and interacts with PEX7 on the peroxisome membrane. Unlike endogenous PEX7, which is predominantly localized to the cytosol, GFP-PEX7 accumulates abnormally on the peroxisomal membrane and induces degradation of endogenous PEX7, concomitant with a reduction in import of PTS2-containing proteins and decreased peroxisomal β-oxidation activity. Thus, GFP-PEX7 on the peroxisomal membrane exerts a dominant negative effect. Mutation of RabE1c restored endogenous PEX7 protein expression and import of PTS2-containing proteins as well as peroxisomal β-oxidation activity. Treatment with proteasome inhibitors also restored endogenous PEX7 protein levels in GFP-PEX7-expressing seedlings. Based on these findings, we conclude that RabE1c binds PEX7 and facilitates PEX7 degradation in the presence of immobile GFP-PEX7 accumulated at the membrane.