I marked the normal descent of a testicle with a green arrow. An undescended testicle, like the one whose path I traced with the shorter red arrow, can be found anywhere along its "path of descent" from just below the pet's kidney to just above its scrotum. Most run out of steam somewhere in the pet's groin area. Those are quite easy for your veterinarian to locate visually and through palpation. Carefully shaving the area is helpful.

These undescended testicles tend to be flabby and smaller than normal. But the feel of the epididymis portion as it slips through your veterinarian's finger tips is quite distinctive. Those testicles are easy to remove through a small, superficial incision.

Your pet's testicles form early in its embryonic life from specialized tissue located adjacent to its kidneys. As the embryonic animal develops, a conduit, called the gubernaculum, forms to guide this reproductive tissue to its final location in the pet's scrotum. This process occurs under hormonal control while the baby is still in its mother's womb; and testosterone, produced by the infant's Leydig cells, appears to be an important controlling agent. (ref)

In cryptorchid pets , the process fails to complete correctly. The exact reasons remain unknown. We know that certain breeder and family lines of dogs and cats have more of this problem than others. So ethical veterinarians discourage breeders from breeding dogs and cats that did not have both their testicles fully in their scrotums at birth. However some scientists feel that other factors might also come into play (ref). One of these could conceivably be the diet of the mother, should it contain endocrine disruptor compounds.