Proteases play an essential role in modulating the turnover of extracellular matrix. Furthermore, they are involved in the processing of various proteins thus regulating fundamental cellular functions such as apoptosis, cells growth and activation, protein secretion and phagocytosis. At the tissue and organ levels, proteases influence mechanisms including cell migration and invasion, cellular interactions and signal transduction as well as tissue formation and stabilization. Proteases are classified based on their catalytic mechanisms into serin, aspartic, metallo, threonin and cysteine proteases and are localized extracellularly, at the cellular surface, in the cytoplasm of cells or within specific subcellular structures such as lysosomes. The present review focuses on the specific functions of lysosomal cysteine proteases and the potential effects of modulators of cysteine protease activity.