Mechanism
Summary
Inactive Rabs are found in the cytoplasm bound to GDP and a GDP dissociation inhibitor (GDI). To become active, a guanine-nucleotide exchange factor (GEF) must mediate the phosphorylation of the Rab-bound GDP to GTP.
This phosphorylation causes a conformational change in the Rab itself, exposing a lipid group on the surface which is able to bind to the vesicle membrane.
Once the Rab is bound, the vesicle moves along the cytoskeleton to its destination within the cell. Once the vesicle reaches its target, the Rab binds to a specific Rab effector protein on the acceptor membrane which allows docking.
Once membrane fusion is complete, the Rab-bound GTP is hydrolysed to GDP again (via a GTPase activating protein (GAP)), and is released from the acceptor membrane into the cytoplasm where the GDI reattaches to the inactive Rab.

Fig 2. Cyclic process of Rab mediated vesicle transport
Geranylgeranylation
Newly synthesised Rabs must first be modified by the addition of one or two geranylgeranyl groups on cys residues in the carboxy-terminus before they can become involved in membrane trafficking. This is mediated by a Rab geranylgeranyl transferase (RabGGTase).
However, the Rab by itself is too unstable for the RabGGTase to modify, and so a Rab Escort Protein is needed (REP). The REP binds to the unmodified, inactive (GDP-bound) Rab forming a stable complex, and then presents it to the RabGGTase.
Once the Rab has been geranylgeranylated it can then be released by the REP and bound by its GDI until it is activated.
Rab Escort Proteins (REPs)
There are two different REPs: REP-1 and REP-2. Different Rabs have different affinities for each escort protein; this increases the Rabs ability to mediate specific membrane transport.
The different REPs are found in varying concentrations in different tissues and cells, this adds to Rab specificity. REPs are responsible for mediating the geranylgeranylation of newly synthesised Rabs by RabGGTase. They do this by binding to inactive Rabs and presenting the resulting stable complex to the RabGGTase. Without this vital step, Rab mediated vesicle transport cannot occur.
Summary Picture

Fig 3. Geranylgeranylation of newly synthesized Rab and its subsequent activation by GTP binding and inactivation via hydrolysis of the bound GTP molecule to GDP.
