p7 protein is a small protein encoded by Hepatitis C virus (HCV) that functions as an ion channel in planar lipid bilayers. The function of p7 is vital for the virus life cycle. In this study, the p7 protein of genotype 2a (strain JFH1; the only strain that replicates and produces virus progeny in vitro) was tagged with either an enhanced green fluorescent protein (eGFP) or a haemagglutinin (HA) epitope to facilitate tracking of the protein in the intracellular environment. The tagged viral polyprotein was expressed transiently in the cells after transfection with the recombinant RNA transcripts. Confocal microscopy revealed that the tagged p7 protein was localized in the endoplasmic reticulum (ER) but not associated with mitochondria. Immunoelectron microscopy confirmed the p7 localization data and, moreover, showed that intracellular virus-like particles formed in the cells transfected with the wild-type, but not the recombinant, transcripts. Following a few passages of the transfected cells, the recombinant genome with the HA tag reverted to wild-type and the entire tag was deleted. Therefore, in this study, it has been demonstrated that the p7 protein in the context of the full-length polyprotein encoded by a replication competent genome is only localized to the ER and has a possible role in HCV particle formation.