In the mouse, the loop-tail mutation (Lp) causes a very severe neural tube defect, which is caused by mutations in the Vangl2 gene. In mammals, Vangl1 and Vangl2 code for integral membrane proteins that assemble into asymmetrically distributed membrane complexes that establish planar cell polarity in epithelial cells and that regulate convergent extension movements during embryogenesis. To date, VANGL are the only genes in which mutations cause neural tube defects in humans. Three independently arising Lp alleles have been described for Vangl2: D255E, S464N, and R259L. Here we report a common mechanism for both the naturally occurring Lp (S464N) and a novel ENU-induced mutation Lp(m2Jus)(R259L). We show that the S464N and R259L variants stably expressed in polarized MDCK kidney cells fail to reach the plasma membrane, their site for biological function. The mutant variants are retained intracellularly in the endoplasmic reticulum, colocalizing with ER chaperone calreticulin. Furthermore, the mutants also show a dramatically reduced half-life of ∼3 h, compared to ∼22 h for the wild-type protein, and are rapidly degraded in a proteasome-dependent and MG132-sensitive fashion. Coexpressing individually the three known allelic Lp variants with the wild-type protein does not influence the localization of the WT at the plasma membrane, suggesting that the codominant nature of the Lp trait in vivo is due to haploid insufficiency caused by a partial loss of function in a gene dosage-dependent pathway, as opposed to a dominant negative phenotype. Our study provides a biochemical framework for the study of recently identified mutations in hVANGL1 and hVANGL2 in sporadic or familial cases of neural tube defects.