Mycolactone is the virulence toxin of Mycobacterium ulcerans, causative agent of Buruli ulcer. Mycolactone inhibits the Sec61-dependent co-translational translocation of signal peptide-bearing secreted and membrane proteins into the endoplasmic reticulum. Sec61 inhibition leads to accumulation of mislocalised proteins in the cytosol and initially triggers an integrated stress response-dependent activation of autophagy that contributes to cell survival. Here we show sustained exposure to mycolactone blocks late-stage autophagy and induces nuclear translocation of the lysosomal stress marker TFEB. This follows loss of ATP6AP1 and ATP6AP2, Sec61-substrates required for assembly of the Vacuolar-ATPase, leading to reduced lysosomal biogenesis and acidification. These effects are reduced in cells expressing a mycolactone-resistant Sec61 alpha mutant and phenocopied by other Sec61 inhibitors. Loss of lysosomal function compromises the cell's capacity to withstand the proteostatic stress caused by Sec61 inhibition and could impair the ability of phagocytes to combat infection with M. ulcerans and contribute to the tissue necrosis in Buruli ulcer. Furthermore, since Sec61 inhibition is being pursued as a therapeutic target in several diseases, potential drugs should be screened against this activity to avoid unwanted side-effects.