The RCS rat is a widely studied model of recessively inherited retinal degeneration. The genetic defect, known as rdy (retinal dystrophy), results in failure of the retinal pigment epithelium (RPE) to phagocytize shed photoreceptor outer segment membranes. We previously used positional cloning and in vivo genetic complementation to demonstrate that Mertk is the gene for rdy. We have now used a rat primary RPE cell culture system to demonstrate that the RPE is the site of action of Mertk and to obtain functional evidence for a key role of Mertk in RPE phagocytosis. We found that Mertk protein is absent from RCS, but not wild-type, tissues and cultured RPE cells. Delivery of rat Mertk to cultured RCS RPE cells by means of a recombinant adenovirus restored the cells to complete phagocytic competency. Infected RCS RPE cells ingested exogenous outer segments to the same extent as wild-type RPE cells, but outer segment binding was unaffected. Mertk protein progressively co-localized with outer segment material during phagocytosis by primary RPE cells, and activated Mertk accumulated during the early stages of phagocytosis by RPE-J cells. We conclude that Mertk likely functions directly in the RPE phagocytic process as a signaling molecule triggering outer segment ingestion.