An approach to renormalization of scalar fields on the Doplicher–Fredenhagen–Roberts (DFR) quantum spacetime is presented. The effective nonlocal theory obtained through the use of states of optimal localization for the quantum spacetime is reformulated in the language of (perturbative) Algebraic Quantum Field Theory. The structure of the singularities associated to the nonlocal kernel that codifies the effects of non-commutativity is analyzed using the tools of microlocal analysis.