The lysosomal compartment is essential for a variety of cellular functions, including the normal turnover of most long-lived proteins and all organelles. The compartment consists of numerous acidic vesicles (pH ~4-5) that constantly fuse and divide. It receives a large number of hydrolases (~50) from the trans-Golgi network, and substrates from both the cells’ outside (heterophagy) and inside (autophagy). Many macromolecules contain iron that gives rise to an iron-rich environment in lysosomes that recently have degraded such macromolecules. Iron-rich lysosomes are sensitive to oxidative stress, while ‘resting’ lysosomes, which have not recently participated in autophagic events, are not. The magnitude of oxidative stress determines the degree of lysosomal destabilization and, consequently, whether arrested growth, reparative autophagy, apoptosis, or necrosis will follow. Heterophagy is the first step in the process by which immunocompetent cells modify antigens and produce antibodies, while exocytosis of lysosomal enzymes may promote tumor invasion, angiogenesis, and metastasis. Apart from being an essential turnover process, autophagy is also a mechanism by which cells will be able to sustain temporary starvation and rid themselves of intracellular organisms that have invaded, although some pathogens have evolved mechanisms to prevent their destruction. Mutated lysosomal enzymes are the underlying cause of a number of lysosomal storage diseases involving the accumulation of materials that would be the substrate for the corresponding hydrolases, were they not defective. The normal, low-level diffusion of hydrogen peroxide into iron-rich lysosomes causes the slow formation of lipofuscin in long-lived postmitotic cells, where it occupies a substantial part of the lysosomal compartment at the end of the life span. This seems to result in the diversion of newly produced lysosomal enzymes away from autophagosomes, leading to the accumulation of malfunctioning mitochondria and proteins with consequent cellular dysfunction. If autophagy were a perfect turnover process, postmitotic ageing and several age-related neurodegenerative diseases would, perhaps, not take place.