Expression of programmed cell death 1 (PD-1) ligand 1 (PD-L1) protects tumor cells from T cell-mediated immune surveillance, and immune checkpoint blockade (ICB) therapies targeting PD-1 and PD-L1 have exhibited significant clinical benefits. However, the relatively low response rate and observed ICB resistance highlight the need to understand the molecular regulation of PD-L1. Here we show that HIP1R targets PD-L1 to lysosomal degradation to alter T cell-mediated cytotoxicity. HIP1R physically interacts with PD-L1 and delivers PD-L1 to the lysosome through a lysosomal targeting signal. Depletion of HIP1R in tumor cells caused PD-L1 accumulation and suppressed T cell-mediated cytotoxicity. A rationally designed peptide (PD-LYSO) incorporating the lysosome-sorting signal and the PD-L1-binding sequence of HIP1R successfully depleted PD-L1 expression in tumor cells. Our results identify the molecular machineries governing the lysosomal degradation of PD-L1 and exemplify the development of a chimeric peptide for targeted degradation of PD-L1 as a crucial anticancer target.