Tumor necrosis factor-related apoptosis-inducing ligand (TRAIL)-induced apoptosis of liver cancer cell lines requires death receptor-5 (DR5)-dependent permeabilization of lysosomal membranes. Ligated DR5 triggers recruitment of the proapoptotic proteins Bim and Bax to lysosomes, releasing cathepsin B into the cytosol where it mediates mitochondria membrane permeabilization and activation of executioner caspases. Despite the requirement for lysosome membrane permeabilization during TRAIL-induced apoptosis, little is known about the mechanism that controls recruitment of Bim and Bax to lysosomal membranes. Here we report that TRAIL induces recruitment of the multifunctional sorting protein phosphofurin acidic cluster sorting protein-2 (PACS-2) to DR5-positive endosomes in Huh-7 cells where it forms an immunoprecipitatable complex with Bim and Bax on lysosomal membranes. shRNA-targeted knockdown of PACS-2 prevents recruitment of Bim or Bax to lysosomes, blunting the TRAIL-induced lysosome membrane permeabilization. Consistent with the reduced lysosome membrane permeabilization, shRNA knockdown of PACS-2 in Huh-7 cells reduced TRAIL-induced apoptosis and increased clonogenic cell survival. The determination that recombinant PACS-2 bound Bim but not Bax in vitro and that shRNA knockdown of Bim blocked Bax recruitment to lysosomes suggests that TRAIL/DR5 triggers endosomal PACS-2 to recruit Bim and Bax to lysosomes to release cathepsin B and induce apoptosis. Together, these findings provide insight into the lysosomal pathway of apoptosis.