The endolysosomal system fulfils a myriad of cellular functions predicated on regulated membrane identity progressions, collectively termed maturation. Mature or “late” endosomes are designated by small membrane-bound GTPases Rab7 and Arl8b, which can either operate independently or collaborate to form a joint compartment. Whether, and how, Rab7 and Arl8b resolve this hybrid identity compartment to regain functional autonomy is unknown. Here, we report that Arl8b employs its effector SKIP to instigate inactivation and removal of Rab7 from select membranes. We find that SKIP interacts with Rab7 and functions as its negative effector, delivering the cognate GAP, TBC1D15. Recruitment of TBC1D15 to SKIP occurs via the HOPS complex, whose assembly is facilitated by contacts between Rab7 and the KMI motif of SKIP. Consequently, SKIP mediates reinstatement of single identity Arl8b sub-compartment through an ordered Rab7-to-Arl8b handover, and, together with Rab7's positive effector RILP, enforces spatial, temporal and morphological compartmentalization of endolysosomal organelles.