Axonal transport of synaptic vesicle precursors (SVPs) is essential for synapse development and function. The conserved ARF-like small GTPase ARL-8 is localized to SVPs and directly activates UNC-104/KIF1A, the axonal-transport kinesin for SVPs in C. elegans. It is not clear how ARL-8 is activated in this process. Here we show that part of the BLOC-1-related complex (BORC), previously shown to regulate lysosomal transport, is required to recruit and activate ARL-8 on SVPs. We found mutations in six BORC subunits-blos-1/BLOS1, blos-2/BLOS2, snpn-1/Snapin, sam-4/Myrlysin, blos-7/Lyspersin, and blos-9/MEF2BNB-cause defects in axonal transport of SVPs, leading to ectopic accumulation of synaptic vesicles in the proximal axon. This phenotype is suppressed by constitutively active arl-8 or unc-104 mutants. Furthermore, SAM-4/Myrlysin, a subunit of BORC, promotes the GDP-to-GTP exchange of ARL-8 in vitro and recruits ARL-8 onto SVPs in vivo. Thus, BORC regulates the axonal transport of synaptic materials and synapse formation by controlling the nucleotide state of ARL-8. Interestingly, the other two subunits of BORC essential for lysosomal transport, kxd-1/KXD1 and blos-8/Diaskedin, are not required for the SVP transport, suggesting distinct subunit requirements for lysosomal and SVP trafficking.