The CD38 molecule (CD38) catalyzes biogenesis of the calcium-mobilizing messenger cyclic ADP-ribose (cADPR). CD38 has dual membrane orientations, and type III CD38, with its catalytic domain facing the cytosol, has low abundance but is efficient in cyclizing cytosolic NAD to produce cADPR. The role of cell surface type II CD38 in cellular cADPR production is unknown. Here we modulated type II CD38 expression and assessed the effects of this modulation on cADPR levels. We developed a photoactivatable cross-linking probe based on a CD38 nanobody, and, combining it with MS analysis, we discovered that cell surface CD38 interacts with CD71. CD71 knockdown increased CD38 levels, and CD38 knockout reciprocally increased CD71, and both could be cocapped and coimmunoprecipitated. We constructed a chimera comprising the N-terminal segment of CD71 and a CD38 nanobody to mimic CD71's ligand property. Overexpression of this chimera induced a dramatically large decrease in CD38 via lysosomes. Remarkably, cellular cADPR levels did not decrease correspondingly. Bafilomycin-mediated blockade of lysosomal degradation greatly elevated active type II CD38 by trapping it in the lysosomes but also did not increase cADPR levels. Retention of type II CD38 in the endoplasmic reticulum (ER) by expressing an ER construct that prevented its transport to the cell surface likewise did not change cADPR levels. These results provide first and direct evidence that cADPR biogenesis occurs in the cytosol and is catalyzed mainly by type III CD38 and that type II CD38, compartmentalized in the ER or lysosomes or on the cell surface, contributes only minimally to cADPR biogenesis.