The phosphopeptide P140/Lupuzor, which improves the course of lupus disease in mice and patients, targets chaperone-mediated autophagy (CMA), a selective form of autophagy that is abnormally upregulated in lupus-prone MRL/lpr mice. Administered intravenously to diseased mice, P140 reduces the expression level of two major protein players of CMA, LAMP2A and HSPA8, and inhibits CMA in vitro in a cell line that stably expresses a CMA reporter. Here, we aimed to demonstrate that P140 also affects CMA in vivo and to unravel the precise cellular mechanism of how P140 interacts with the CMA process. MRL/lpr mice and CBA/J mice used as control received P140 or control peptides intravenously. Lysosome-enriched fractions of spleen or liver were prepared to examine lysosomal function. Highly purified lysosomes were further isolated and left to incubate with the CMA substrate to study at which cellular step P140 interacts with the CMA process. The data show that P140 effectively regulates CMA in vivo in MRL/lpr mice at the step of substrate lysosomal uptake and restores some alterations of defective lysosomes. For the first time, it is demonstrated that by occluding the intralysosome uptake of CMA substrates, a therapeutic molecule can attenuate excessive CMA activity in a pathological pro-inflammatory context and protect against hyperinflammation. This recovery effect of P140 on hyperactivated CMA is not only important for lupus therapy but potentially also for treating other (auto)inflammatory diseases, including neurologic and metabolic disorders, where CMA modulation would be highly beneficial.