Podosomes mediate cell migration and invasion by coordinating the reorganization of actin cytoskeleton and focal matrix degradation. MMP and serine proteases have been found to function at podosomes. The lysosomal cysteine cathepsins, a third major class of matrix-degrading enzymes involved in tumor invasion and tissue remodeling, have yet to be linked to podosomes with the exception of cathepsin K in osteoclasts. Using inhibitors and shRNA-mediated depletion, we show that cathepsin B participates in podosomes-mediated focal matrix degradation and invasion in v-Src-transformed fibroblasts. We observed that lysosomal marker LAMP-1 localized at the center of podosome rosettes protruding into extracellular matrix using confocal microscopy. Time-lapse live-cell imaging revealed that lysosomal vesicles moved to and fused with podosomes. Disruption of lysosomal pH gradient with Bafilomycin A1, chloroquine, or ammonium chloride greatly enhanced the formation of podosomes and increased the matrix degradation. Live-cell imaging showed that actin structures, induced shortly after Bafilomycin A1 treatment, were closely associated with lysosomes. Overall, our results suggest that cathepsin B, delivered by lysosomal vesicles, is involved in the matrix degradtion of podosomes.