Lysosomal storage diseases result from inherited deficiencies of lysosomal hydrolytic activities or lipid transport. Collectively, these disorders are a common cause of morbidity in the pediatric population and are often associated with severe neurodegeneration. Among this group of diseases is Niemann-Pick type C, an autosomal recessive disorder of lipid trafficking that causes cognitive impairment, ataxia and death, most often in childhood. Here, we review the current knowledge of disease pathogenesis, with particular focus on insights gleaned from genetics and the study of model systems. Critical advances in understanding mechanisms that regulate intracellular cholesterol trafficking have emerged from this work and are highlighted. We review effects of disease-causing mutations on quality control pathways involving the lysosome and endoplasmic reticulum, and discuss how they function to clear the most common mutant protein found in Niemann-Pick type C patients, NPC1-I1061T. Finally, we summarize insights into the mechanisms that degrade misfolded transmembrane proteins in the endoplasmic reticulum and how manipulating these quality control pathways may lead to the identification of novel targets for disease-modifying therapies.