Pseudophosphatases are catalytically inactive but share sequence and structural similarities with classical phosphatases. STYXL1 is a pseudophosphatase that belongs to the family of dual-specificity phosphatases and is known to regulate stress granule formation, neurite formation and apoptosis in different cell types. However, the role of STYXL1 in regulating cellular trafficking or the lysosome function has not been elucidated. Here, we show that the knockdown of STYXL1 enhances the trafficking of β-glucocerebrosidase (β-GC) and its lysosomal activity in HeLa cells. Importantly, the STYXL1-depleted cells display enhanced distribution of endoplasmic reticulum (ER), late endosome and lysosome compartments. Further, knockdown of STYXL1 causes the nuclear translocation of unfolded protein response (UPR) and lysosomal biogenesis transcription factors. However, the upregulated β-GC activity in the lysosomes is independent of TFEB/TFE3 nuclear localization in STYXL1 knockdown cells. The treatment of STYXL1 knockdown cells with 4-PBA (ER stress attenuator) significantly reduces the β-GC activity equivalent to control cells but not additive with thapsigargin, an ER stress activator. Additionally, STYXL1-depleted cells show the enhanced contact of lysosomes with ER, possibly via increased UPR. The depletion of STYXL1 in human primary fibroblasts derived from Gaucher patients showed moderately enhanced lysosomal enzyme activity. Overall, these studies illustrated the unique role of pseudophosphatase STYXL1 in modulating the lysosome function both in normal and lysosome-storage disorder cell types. Thus, designing small molecules against STYXL1 possibly can restore the lysosome activity by enhancing ER stress in Gaucher disease.