2-Hydroxypropyl-β-cyclodextrin (HPβCD) is a Food and Drug Administration-approved excipient used to improve the stability and bioavailability of drugs. Despite its wide use as a drug delivery vehicle and the recent approval of a clinical trial to evaluate its potential for the treatment of a cholesterol storage disorder, the cellular pathways involved in the adaptive response that is activated upon exposure to HPβCD are still poorly defined. Here, we show that cell treatment with HPβCD results in the activation of the transcription factor EB, a master regulator of lysosomal function and autophagy, and in enhancement of the cellular autophagic clearance capacity. HPβCD administration promotes transcription factor EB-mediated clearance of proteolipid aggregates that accumulate due to inefficient activity of the lysosome-autophagy system in cells derived from a patient with a lysosomal storage disorder. Interestingly, HPβCD-mediated activation of autophagy was found not to be associated with activation of apoptotic pathways. This study provides a mechanistic understanding of the cellular response to HPβCD treatment, which will inform the development of safe HPβCD-based therapeutic modalities and may enable engineering HPβCD as a platform technology to reduce the accumulation of lysosomal storage material.