What does Psalm 16:7 mean?

In close fellowship with the Lord David received guidance from God. The Lord told him what to do and what to avoid. Even during many nights, the Lord instructed David. In response to that help, David blessed the Lord. To "bless" means to speak well of.

David calls the Lord's counsel "instruction." David's statement here uses the Hebrew word kilyot, which refers to his inner organs—literally, to the kidneys. In Hebrew thinking, this was the center of one's feelings and emotions, much as "the heart" is used in modern English. It is the innermost part of a person (Psalm 139:13; Proverbs 23:16). That David then speaks about this in the context of guidance from God suggests the idea of the human conscience. When David did wrong, the Lord brought a feeling of correction, and David learned from it.

The Lord instructs believers today from His written Word. It is given for "training in righteousness" (2 Timothy 3:16). However, when a believer acts contrary to Scripture, God teaches him by chastening him. God treats believers as sons by chastening them. The chastening is temporary, and it is designed to yield "the peaceful fruit of righteousness to those who have been trained by it" (Hebrews 12:7–11).