Niemann-Pick Type C (NPC) disease is a lysosomal storage disorder characterized by accumulation of unesterified cholesterol and other lipids in the endolysosomal system. NPC disease results from a defect in either of two distinct cholesterol-binding proteins: a transmembrane protein, NPC1, and a small soluble protein, NPC2. NPC1 and NPC2 are thought to function closely in the export of lysosomal cholesterol with both proteins binding cholesterol in vitro but they may have unrelated lysosomal roles. To investigate this possibility, we compared biochemical consequences of the loss of either protein. Analyses of lysosome-enriched subcellular fractions from brain and liver revealed similar decreases in buoyant densities of lysosomes from NPC1 or NPC2 deficient mice compared to controls. The subcellular distribution of both proteins was similar and paralleled a lysosomal marker. In liver, absence of either NPC1 or NPC2 resulted in similar alterations in the carbohydrate processing of the lysosomal protease, tripeptidyl peptidase I. These results highlight biochemical alterations in the lysosomal system of the NPC-mutant mice that appear secondary to lipid storage. In addition, the similarity in biochemical phenotypes resulting from either NPC1 or NPC2 deficiency supports models in which the function of these two proteins within lysosomes are linked closely.