FAN (factor associated with neutral sphingomyelinase [N-SMase] activation) exhibits striking structural homologies to Lyst (lysosomal trafficking regulator), a BEACH protein whose inactivation causes formation of giant lysosomes/Chediak-Higashi syndrome. Here, we show that cells lacking FAN show a statistically significant increase in lysosome size (although less pronounced as Lyst), pointing to previously unrecognized functions of FAN in regulation of the lysosomal compartment. Since FAN regulates activation of N-SMase in complex with receptor for activated C-kinase (RACK)1, a scaffolding protein that recruits and stabilizes activated protein kinase C (PKC) isotypes at cellular membranes, and since an abnormal (calpain-mediated) downregulation/membrane recruitment of PKC has been linked to the defects observed in Lyst-deficient cells, we assessed whether PKC is also of relevance in FAN signaling. Our results demonstrate that activation of PKC is not required for regulation of N-SMase by FAN/RACK1. Conversely, activation of PKC and recruitment/stabilization by RACK1 occurs uniformly in the presence or absence of FAN (and equally, Lyst). Furthermore, regulation of lysosome size by FAN is not coupled to an abnormal downregulation/membrane recruitment of PKC by calpain. Identical results were obtained for Lyst, questioning the previously reported relevance of PKC for formation of giant lysosomes and in Chediak-Higashi syndrome. In summary, FAN mediates activation of N-SMase as well as regulation of lysosome size by signaling pathways that operate independent from activation/membrane recruitment of PKC.