Infantile neuronal ceroid lipofuscinosis (INCL) is a pediatric neurodegenerative disease caused by mutations in the human CLN1 gene. CLN1 encodes palmitoyl–protein thioesterase 1 (PPT1), suggesting an important role for the regulation of palmitoylation in normal neuronal function. To further elucidate Ppt1 function, we performed a gain-of-function modifier screen in Drosophila using a collection of enhancer–promoter transgenic lines to suppress or enhance the degeneration produced by overexpression of Ppt1 in the adult visual system. Modifier genes identified in our screen connect Ppt1 function to synaptic vesicle cycling, endo-lysosomal trafficking, synaptic development, and activity-dependent remodeling of the synapse. Furthermore, several homologs of the modifying genes are known to be regulated by palmitoylation in other systems and may be in vivo substrates for Ppt1. Our results complement recent work on mouse Ppt1^−/− cells that shows a reduction in synaptic vesicle pools in primary neuronal cultures and defects in endosomal trafficking in human fibroblasts. The pathways and processes implicated by our modifier loci shed light on the normal cellular function of Ppt1. A greater understanding of Ppt1 function in these cellular processes will provide valuable insight into the molecular etiology of the neuronal dysfunction underlying the disease.