Macrophages are professional phagocytes that are essential for host defense and tissue homeostasis. Proper membrane trafficking and degradative functions of the endolysosomal system are known to be critical for the function of these cells. We have found that PIKfyve, the kinase that synthesizes the endosomal phosphoinositide phosphatidylinositol-3,5-bisphosphate, is an essential regulator of lysosomal biogenesis and degradative functions in macrophages. Genetically engineered mice lacking PIKfyve in their myeloid cells (PIKfyvefl/fl LysM-Cre) develop diffuse tissue infiltration of foamy macrophages, hepatosplenomegaly, and systemic inflammation. PIKfyve loss in macrophages causes enlarged endolysosomal compartments and impairs the lysosomal degradative function. Moreover, PIKfyve deficiency increases the cellular levels of lysosomal proteins. Although PIKfyve deficiency reduced the activation of mTORC1 pathway and was associated with increased cleavage of TFEB proteins, this does not translate into transcriptional activation of lysosomal genes, suggesting that PIKfyve modulates the abundance of lysosomal proteins by affecting the degradation of these proteins. Our study shows that PIKfyve modulation of lysosomal degradative activity and protein expression is essential to maintain lysosomal homeostasis in macrophages.