Resident proteins of the exocytic pathway are maintained at various levels through coatomer protein I (COPI)-mediated recycling. Sorting of cargo by COPI requires GTP hydrolysis by ADP-ribosylation factor 1 (ARF-1). This small GTPase recruits coatomer onto Golgi membranes and upon hydrolysis, is thought to release coatomer back into the cytosol. This step requires the activating protein, ARFGAP1. By coupling sorting to a cargo-induced sequestering of ARFGAP1, we have formulated a kinetic proof-reading model that explains how a GTP hydrolysis-driven coat release can yield an active sorting event. The sorting scheme predicts a dependency on the amount of ARFGAP1 and explains the recent experimental findings that ARF-1 and COPI detach with different time constants from the Golgi membrane in vivo.