Sustained directional fibroblast migration requires both polarized activation of the protrusive signal, Rac1, and redistribution of inactive Rac1 from the rear of the cell so that it can be redistributed or degraded. In this work, we determine how alternative endocytic mechanisms dictate the fate of Rac1 in response to the extracellular matrix environment. We discover that both coronin-1C and caveolin retrieve Rac1 from similar locations at the rear and sides of the cell. We find that coronin-1C-mediated extraction, which is responsible for Rac1 recycling, is a constitutive process that maintains Rac1 protein levels within the cell. In the absence of coronin-1C, the effect of caveolin-mediated endocytosis, which targets Rac1 for proteasomal degradation, becomes apparent. Unlike constitutive coronin-1C-mediated trafficking, caveolin-mediated Rac1 endocytosis is induced by engagement of the fibronectin receptor syndecan-4. Such an inducible endocytic/degradation mechanism would predict that, in the presence of fibronectin, caveolin defines regions of the cell that are resistant to Rac1 activation but, in the absence of fibronectin leaves more of the membrane susceptible to Rac1 activation and protrusion. Indeed, we demonstrate that fibronectin-stimulated activation of Rac1 is accelerated in the absence of caveolin and that, when caveolin is knocked down, polarization of active Rac1 is lost in FRET experiments and culminates in shunting migration in a fibrous fibronectin matrix. Although the concept of polarized Rac1 activity in response to chemoattractants has always been apparent, our understanding of the balance between recycling and degradation explains how polarity can be maintained when the chemotactic gradient has faded.