Protein homeostasis or proteostasis is critical for proper cellular function and survival. It relies on the balance between protein synthesis and degradation. Lysosomes play an important role in degrading and recycling intracellular components via autophagy. Among the three types of lysosome-based autophagy pathways, chaperone-mediated autophagy (CMA) selectively degrades cellular proteins with KFERQ-like motif by unique machinery. During the past several years, significant advances have been made in our understanding of how CMA itself is modulated and what physiological and pathological processes it may be involved in. One particularly exciting discovery is how other cellular stress organelles such as ER signal to CMA. As more proteins are identified as CMA substrates, CMA function has been associated with an increasing number of important cellular processes, organelles, and diseases, including neurodegenerative diseases. Here we will summarize the recent advances in CMA biology, highlight ER stress-induced CMA, and discuss the role of CMA in diseases.