The intracellular assembly of tau aggregates is a pathological hallmark shared by Alzheimer's disease and other neurodegenerative disorders known collectively as tauopathies. To model how tau fibrillogenesis evolves in tauopathies, we previously established transfectant M1C cultures from human neuroblastoma BE(2)-M17D cells that inducibly express human tau. In the present study, these cells were used to determine the role of the autophagic-lysosomal system in the degradation and aggregation of wild-type tau. Tau induction for 5 days led to the accumulation of tau with nominal assembly of tau aggregates within cells. When the lysosomotropic agent, chloroquine (CQ), was added following the termination of tau induction, tau clearance was delayed. Decreased tau truncation and increased levels of intact tau were observed. When present during tau induction, CQ led to tau accumulation and promoted the formation of sarkosyl-insoluble aggregates containing both truncated and full-length tau. CQ treatment significantly decreased the activities of cathepsins D, B and L, and the inhibition of cathepsins B and L mimicked the effect of CQ and increased tau levels in cells. Additionally, exposure of cells to the autophagy inhibitor, 3-methyladenine, led to tau accumulation and aggregation. These results suggest that the autophagic-lysosomal system plays a role in the clearance of tau, and that dysfunction of this system results in the formation of tau oligomers and insoluble aggregates.