Heparin-binding epidermal growth factor (EGF)- like growth factor (HB-EGF) is synthesized in the ER, transported along the exocytic pathway, and expressed on the plasma membrane as a type I transmembrane protein. Upon extracellular stimulation, HB-EGF, either proHB-EGF or the shed form HB-EGF-CTF, undergoes endocytosis and is then transported retrogradely to the ER. In this study, we showed the essential contribution of the short cytoplasmic tail of HB-EGF (HB-EGF-cyto) to the bidirectional intracellular trafficking between the ER and plasma membrane and revealed several critical amino acids residues that are responsible for internalization from the plasma membrane and ER targeting. We suggest that these anterograde and retrograde sorting signals within HB-EGF-cyto are strictly regulated by protein modification and conformation.