Delivery of endocytosed macromolecules to mammalian cell lysosomes occurs by direct fusion of late endosomes with lysosomes, resulting in the formation of hybrid organelles from which lysosomes are reformed. The molecular mechanisms of this fusion are analogous to those of homotypic vacuole fusion in Saccharomyces cerevisiae. We report herein the major roles of the mammalian homolog of yeast Vps18p (mVps18p), a member of the homotypic fusion and vacuole protein sorting complex. When overexpressed, mVps18p caused the clustering of late endosomes/lysosomes and the recruitment of other mammalian homologs of the homotypic fusion and vacuole protein sorting complex, plus Rab7-interacting lysosomal protein. The clusters were surrounded by components of the actin cytoskeleton, including actin, ezrin, and specific unconventional myosins. Overexpression of mVps18p also overcame the effect of wortmannin treatment, which inhibits membrane traffic out of late endocytic organelles and causes their swelling. Reduction of mVps18p by RNA interference caused lysosomes to disperse away from their juxtanuclear location. Thus, mVps18p plays a critical role in endosome/lysosome tethering, fusion, intracellular localization and in the reformation of lysosomes from hybrid organelles.