Hafting et al. (2005) described grid cells in the dorsocaudal region of the medial entorhinal cortex (dMEC). These cells show a strikingly regular grid-like firing-pattern as a function of the position of a rat in an enclosure. Since the dMEC projects to the hippocampal areas containing the well-known place cells, the question arises whether and how the localized responses of the latter can emerge based on the output of grid cells. Here, we show that, starting with simulated grid-cells, a simple linear transformation maximizing sparseness leads to a localized representation similar to place fields.