The P2X(4) receptor has a widespread distribution in the central nervous system and the periphery, and plays an important role in the function of immune cells and the vascular system. Its upregulation in microglia contributes to neuropathic pain following nerve injury. The mechanisms involved in its regulation are not well understood, although we have previously shown that it is constitutively retrieved from the plasma membrane and resides predominantly within intracellular compartments. Here, we show that the endogenous P2X(4) receptors in cultured rat microglia, vascular endothelial cells and freshly isolated peritoneal macrophages are localized predominantly to lysosomes. Lysosomal targeting was mediated through a dileucine-type motif within the N-terminus, together with a previously characterized tyrosine-based endocytic motif within the C-terminus. P2X(4) receptors remained stable within the proteolytic environment of the lysosome and resisted degradation by virtue of their N-linked glycans. Stimulation of phagocytosis triggered the accumulation of P2X(4) receptors at the phagosome membrane. Stimulating lysosome exocytosis, either by incubating with the Ca(2+) ionophore ionomycin, for normal rat kidney (NRK) cells and cultured rat microglia, or the weak base methylamine, for peritoneal macrophages, caused an upregulation of both P2X(4) receptors and the lysosomal protein LAMP-1 at the cell surface. Lysosome exocytosis in macrophages potentiated ATP-evoked P2X(4) receptor currents across the plasma membrane. Taken together, our data suggest that the P2X(4) receptor retains its function within the degradative environment of the lysosome and can subsequently traffic out of lysosomes to upregulate its exposure at the cell surface and phagosome.