In recent years, our vision of lysosomes has drastically changed. Formerly considered to be mere degradative compartments, they are now recognized as key players in many cellular processes. The ability of lysosomes to respond to different stimuli revealed a complex and coordinated regulation of lysosomal gene expression. This review discusses the participation of the transcription factors TFEB and TFE3 in the regulation of lysosomal function and biogenesis, as well as the role of the lysosomal pathway in cellular adaptation to a variety of stress conditions, including nutrient deprivation, mitochondrial dysfunction, protein misfolding, and pathogen infection. We also describe how cancer cells make use of TFEB and TFE3 to promote their own survival and highlight the potential of these transcription factors as therapeutic targets for the treatment of neurological and lysosomal diseases.