Cilia are important sensory organelles, which are thought to be essential regulators of numerous signaling pathways. In Caenorhabditis elegans, defects in sensory cilium formation result in a small-body phenotype, suggesting the role of sensory cilia in body size determination. Previous analyses suggest that lack of normal cilia causes the small-body phenotype through the activation of a signaling pathway which consists of the EGL-4 cGMP-dependent protein kinase and the GCY-12 receptor-type guanylyl cyclase. By genetic suppressor screening of the small-body phenotype of a cilium defective mutant, we identified a chb-3 gene. Genetic analyses placed chb-3 in the same pathway as egl-4 and gcy-12 and upstream of egl-4. chb-3 encodes a novel protein, with a zf-MYND motif and ankyrin repeats, that is highly conserved from worm to human. In chb-3 mutants, GCY-12 guanylyl cyclase visualized by tagged GFP (GCY-12::GFP) fails to localize to sensory cilia properly and accumulates in cell bodies. Our analyses suggest that decreased GCY-12 levels in the cilia of chb-3 mutants may cause the suppression of the small-body phenotype of a cilium defective mutant. By observing the transport of GCY-12::GFP particles along the dendrites to the cilia in sensory neurons, we found that the velocities and the frequencies of the particle movement are decreased in chb-3 mutant animals. How membrane proteins are trafficked to cilia has been the focus of extensive studies in vertebrates and invertebrates, although only a few of the relevant proteins have been identified. Our study defines a new regulator, CHB-3, in the trafficking process and also shows the importance of ciliary targeting of the signaling molecule, GCY-12, in sensory-dependent body size regulation in C. elegans. Given that CHB-3 is highly conserved in mammal, a similar system may be used in the trafficking of signaling proteins to the cilia of other species. © 2010 Fujiwara et al.