Neuronal ceroid lipofuscinoses (NCLs) constitute a group of progressive neurodegenerative disorders resulting from mutations in at least eight different genes. Mutations in the most recently identified NCL gene, MFSD8/CLN7, underlie a variant of late-infantile NCL (vLINCL). The MFSD8/CLN7 gene encodes a polytopic protein with unknown function, which shares homology with ion-coupled membrane transporters. In this study, we confirmed the lysosomal localization of the native CLN7 protein. This localization of CLN7 is not impaired by the presence of pathogenic missense mutations or after genetic ablation of the N-glycans. Expression of chimeric and full-length constructs showed that lysosomal targeting of CLN7 is mainly determined by an N-terminal dileucine motif, which specifically binds to the heterotetrameric adaptor AP-1 in vitro. We also show that CLN7 mRNA is more abundant in neurons than astrocytes and microglia, and that it is expressed throughout rat brain, with increased levels in the granular layer of cerebellum and hippocampal pyramidal cells. Interestingly, this cellular and regional distribution is in good agreement with the autofluorescent lysosomal storage and cell loss patterns found in brains from CLN7-defective patients. Overall, these data highlight lysosomes as the primary site of action for CLN7, and suggest that the pathophysiology underpinning CLN7-associated vLINCL is a cell-autonomous process.