In retinal bipolar neurons, synaptic ribbons mark the presence of exocytotic active zones in the synaptic terminal. It is unknown, however, where compensatory vesicle retrieval is localized in this cell type and by what mechanism(s) excess membrane is recaptured. To determine whether endocytosis is localized or diffuse in mouse bipolar neurons, we imaged FM4-64 to track vesicles in cells whose synaptic ribbons were tagged with a fluorescent peptide. In synaptic terminals, vesicle retrieval occurred at discrete sites that were spatially consistent over multiple stimuli, indicative of endocytotic "hot spots." Retrieval sites were spatially correlated with fluorescently labeled synaptic ribbons. Electron microscopy (EM) analysis of bipolar cell terminals after photoconversion of internalized FM dye revealed that almost all of the dye was contained within vesicles approximately 30 nm in diameter. Clathrin-coated vesicles were observed budding from the plasma membrane and within the cytosol, and application of dynasore, a dynamin inhibitor, arrested membrane retrieval just after the budding stage. We conclude that synaptic vesicles in the fine branches of mouse bipolar axon terminals are retrieved locally near active zones, at least in part via a clathrin-mediated pathway.