The unfolded protein response of the endoplasmic reticulum (UPRER) is a crucial mediator of secretory pathway homeostasis. Expression of the spliced and active form of the UPRER transcription factor XBP-1, XBP-1s, in the nervous system triggers activation of the UPRER in the intestine of Caenorhabditis elegans (C. elegans) through release of a secreted signal, leading to increased longevity. We find that expression of XBP-1s in the neurons or intestine of the worm strikingly improves proteostasis in multiple tissues, through increased clearance of toxic proteins. To identify the mechanisms behind this enhanced proteostasis, we conducted intestine-specific RNA-seq analysis to identify genes upregulated in the intestine when XBP-1s is expressed in neurons. This revealed that neuronal XBP-1s increases the expression of genes involved in lysosome function. Lysosomes in the intestine of animals expressing neuronal XBP-1s are more acidic, and lysosomal protease activity is higher. Moreover, intestinal lysosome function is necessary for enhanced lifespan and proteostasis. These findings suggest that activation of the UPRER in the intestine through neuronal signaling can increase the activity of lysosomes, leading to extended longevity and improved proteostasis across tissues.