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Summary: The ε4 allele of apolipoprotein E (APOE4) is a genetic risk factor for many diseases, including late-onset Alzheimer’s disease (AD). We investigate the cellular consequences of APOE4 in human iPSC-derived astrocytes, observing an endocytic defect in APOE4 astrocytes compared with their isogenic APOE3 counterparts. Given the evolutionarily conserved nature of endocytosis, we built a yeast model to identify genetic modifiers of the endocytic defect associated with APOE4. In yeast, only the expression of APOE4 results in dose-dependent defects in both endocytosis and growth. We discover that increasing expression of the early endocytic adaptor protein Yap1802p, a homolog of the human AD risk factor PICALM, rescues the APOE4-induced endocytic defect. In iPSC-derived human astrocytes, increasing expression of PICALM similarly reverses endocytic disruptions. Our work identifies a functional interaction between two AD genetic risk factors—APOE4 and PICALM—centered on the conserved biological process of endocytosis.