Charge density waves and negative differential resistance are seemingly unconnected physical phenomena. The former is an ordered quantum fluid of electrons, intensely investigated for its relation with superconductivity, while the latter receives much attention for its potential applications in electronics. Here we show that these two phenomena can not only coexist but also that the localized electronic states of the charge density wave are essential to induce negative differential resistance in a transition metal dichalcogenide, 1T-TaS2. Using scanning tunneling microscopy and spectroscopy, we report the observation of negative differential resistance in the commensurate charge density wave state of 1T-TaS2. The observed phenomenon is explained by the interplay of interlayer and intra-layer tunneling with the participation of the atomically localized states of the charge density wave maxima and minima. We demonstrate that lattice defects can locally affect the coupling between the layers and are therefore a mechanism to realize NDR in these materials.