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Funder: Vetenskapsrådet (Swedish Research Council); doi: https://doi.org/10.13039/501100004359, Midbrain dopaminergic (DA) axons make long longitudinal projections towards the striatum. Despite the importance of DA striatal innervation, processes involved in establishment of DA axonal connectivity remain largely unknown. Here we demonstrate a striatal-specific requirement of transcriptional regulator Nolz1 in establishing DA circuitry formation. DA projections are misguided and fail to innervate the striatum in both constitutive and striatal-specific Nolz1 mutant embryos. The lack of striatal Nolz1 expression results in nigral to pallidal lineage conversion of striatal projection neuron subtypes. This lineage switch alters the composition of secreted factors influencing DA axonal tract formation and renders the striatum non-permissive for dopaminergic and other forebrain tracts. Furthermore, transcriptomic analysis of wild-type and Nolz1−/− mutant striatal tissue led to the identification of several secreted factors that underlie the observed guidance defects and proteins that promote DA axonal outgrowth. Together, our data demonstrate the involvement of the striatum in orchestrating dopaminergic circuitry formation.