Mutations in human VPS4A are associated with neurodevelopmental defects, including motor delays and defective muscle tone. VPS4A encodes a AAA-ATPase required for membrane scission, but how mutations in VPS4A lead to impaired control of motor function is not known. Here we identified a mutation in zebrafish vps4a, T248I, that affects sensorimotor transformation. Biochemical analyses indicate that the T248I mutation reduces the ATPase activity of Vps4a and disassembly of ESCRT filaments, which mediate membrane scission. Consistent with the role for Vps4a in exosome biogenesis, vps4aT248I larvae have enlarged endosomal compartments in the CNS and decreased numbers of circulating exosomes in brain ventricles. Resembling the central form of hypotonia in VPS4A patients, motor neurons and muscle cells are functional in mutant zebrafish. Both somatosensory and vestibular inputs robustly evoke tail and eye movements, respectively. In contrast, optomotor responses, vestibulospinal, and acoustic startle reflexes are absent or strongly impaired in vps4aT248I larvae, indicating a greater sensitivity of these circuits to the T248I mutation. ERG recordings revealed intensity-dependent deficits in the retina, and in vivo calcium imaging of the auditory pathway identified a moderate reduction in afferent neuron activity, partially accounting for the severe motor impairments in mutant larvae. Further investigation of central pathways in vps4aT248I mutants showed that activation of descending vestibulospinal and midbrain motor command neurons by sensory cues is strongly reduced. Our results suggest that defects in sensorimotor transformation underlie the profound yet selective effects on motor reflexes resulting from the loss of membrane scission mediated by Vps4a.