Antisense oligonucleotide (ASO) therapeutics are being investigated for a broad range of neurological diseases. While ASOs have been effective in the clinic, improving productive ASO internalization into target cells remains a key area of focus in the field. Here, we investigated how the delivery of ASO-loaded lipid nanoparticles (LNPs) affects ASO activity, subcellular trafficking, and distribution in the brain. We show that ASO-LNPs increase ASO activity up to 100-fold in cultured primary brain cells as compared to non-encapsulated ASO. However, in contrast to the widespread ASO uptake and activity observed following free ASO delivery in vivo, LNP-delivered ASOs did not downregulate mRNA levels throughout the brain after intracerebroventricular injection. This lack of activity was likely due to ASO accumulation in cells lining the ventricles and blood vessels. Furthermore, we reveal a formulation-dependent activation of the immune system post dosing, suggesting that LNP encapsulation cannot mask cellular ASO backbone-mediated toxicities. Together, these data provide insights into how LNP encapsulation affects ASO distribution as well as activity in the brain, and a foundation that enables future optimization of brain-targeting ASO-LNPs.