Lysosomes are dynamic organelles receiving membrane traffic input from the biosynthetic, endocytic and autophagic pathways. They may be regarded as storage organelles for acid hydrolases and are capable of fusing with late endosomes to form hybrid organelles where digestion of endocytosed macromolecules occurs. Reformation of lysosomes from the hybrid organelles involves content condensation and probably removal of some membrane proteins by vesicular traffic. Lysosomes can also fuse with the plasma membrane in response to cell surface damage and a rise in cytosolic Ca(2+) concentration. This process is important in plasma membrane repair. The molecular basis of membrane traffic pathways involving lysosomes is increasingly understood, in large part because of the identification of many proteins required for protein traffic to vacuoles in the yeast Saccharomyces cerevisiae. Mammalian orthologues of these proteins have been identified and studied in the processes of vesicular delivery of newly synthesized lysosomal proteins from the trans-Golgi network, fusion of lysosomes with late endosomes and sorting of membrane proteins into lumenal vesicles. Several multi-protein oligomeric complexes required for these processes have been identified. The present review focuses on current understanding of the molecular mechanisms of fusion of lysosomes with both endosomes and the plasma membrane and on the sorting events required for delivery of newly synthesized membrane proteins, endocytosed membrane proteins and other endocytosed macromolecules to lysosomes.