Niemann-Pick disease Type C (NPC) is caused by mutations in the cholesterol transport protein NPC1 leading to the endolysosomal accumulation of the lipid and to psychiatric alterations. Using an NPC mouse model (Npc1) we show aberrant mGluR lysosomal accumulation and reduction at plasma membrane in NPC1 deficient neurons. This phenotype was induced in wild-type (wt) neurons by genetic and pharmacological NPC1 silencing. Extraction of cholesterol normalized mGluR distribution in NPC1-deficient neurons. Intracellular accumulation of mGluR was functionally active leading to enhanced mGluR-dependent long-term depression (mGluR-LTD) in Npc1 hippocampal slices. mGluR-LTD was lower or higher in Npc1 slices compared with wt when stimulated with non-membrane-permeable or membrane-permeable mGluR agonists, respectively. Oral treatment with the mGluR antagonist 2-chloro-4-((2,5-dimethyl-1-(4-(trifluoromethoxy)phenyl)-1H-imidazol-4-yl)ethynyl)pyridine (CTEP) reduced mGluR-LTD and ameliorated psychiatric anomalies in the Npc1 mice. Increased neuronal mGluR levels were found in an NPC patient. These results implicate mGluR alterations in NPC psychiatric condition and provide a new therapeutic strategy that might help patients suffering from this devastating disease.