Syt VII is a Ca(2+) sensor that regulates lysosome exocytosis and plasma membrane repair. Because it lacks motifs that mediate lysosomal targeting, it is unclear how Syt VII traffics to these organelles. In this paper, we show that mutations or inhibitors that abolish palmitoylation disrupt Syt VII targeting to lysosomes, causing its retention in the Golgi complex. In macrophages, Syt VII is translocated simultaneously with the lysosomal tetraspanin CD63 from tubular lysosomes to nascent phagosomes in a Ca(2+)-dependent process that facilitates particle uptake. Mutations in Syt VII palmitoylation sites block trafficking of Syt VII, but not CD63, to lysosomes and phagosomes, whereas tyrosine replacement in the lysosomal targeting motif of CD63 causes both proteins to accumulate on the plasma membrane. Complexes of CD63 and Syt VII are detected only when Syt VII palmitoylation sites are intact. These findings identify palmitoylation-dependent association with the tetraspanin CD63 as the mechanism by which Syt VII is targeted to lysosomes.