The main purpose of this paper is to investigate degenerate $C$-distribution semigroups in the setting of barreled sequentially complete locally convex spaces. In our approach, the infinitesimal generator of a degenerate $C$-distribution semigroup is a multivalued linear operator and the regularizing operator $C$ is not necessarily injective. We provide a few important theoretical novelties, considering also exponential subclasses of degenerate $C$-distribution semigroups.