The SORL1 gene has recently emerged as a strong Alzheimer’s Disease (AD) risk gene. Over 500 different variants have been identified in the gene and the contribution of individual variants to AD development and progression is still largely unknown. Here, we describe a family consisting of 2 parents and 5 offspring. Both parents were affected with dementia and one had confirmed AD pathology with an age of onset > 75 years. All offspring were affected with AD with ages at onset ranging from 53 years to 74 years. DNA was available from the parent with confirmed AD and 5 offspring. We identified a coding variant, p.(Arg953Cys), in SORL1 in 5 of 6 individuals affected by AD. Notably, variant carriers had severe AD pathology, and the SORL1 variant segregated with TDP-43 pathology (LATE-NC). We further characterized this variant and show that this Arginine substitution occurs at a critical position in the YWTD-domain of the SORL1 translation product, SORL1. Functional studies further show that the p.R953C variant leads to retention of the SORL1 protein in the endoplasmic reticulum which leads to decreased maturation and shedding of the receptor and prevents its normal endosomal trafficking. Together, our analysis suggests that p.R953C is a pathogenic variant of SORL1 and sheds light on mechanisms of how missense SORL1 variants may lead to AD.