Chediak–Higashi syndrome, caused by mutations in the Lysosome Trafficking Regulator (Lyst) gene, is a recessive hypopigmentation disorder characterized by albinism, neuropathies, neurodegeneration, and defective immune responses, with enlargement of lysosomes and lysosome-related organelles. Although recent studies have suggested that Lyst mutations impair the regulation of sizes of lysosome and lysosome-related organelle, the underlying pathogenic mechanism of Chediak–Higashi syndrome is still unclear. Here we show striking evidence that deficiency in LYST protein function leads to accumulation of photoreceptor outer segment phagosomes in retinal pigment epithelial cells, and reduces adhesion between photoreceptor outer segment and retinal pigment epithelial cells in a mouse model of Chediak–Higashi syndrome. In addition, we observe elevated levels of cathepsins, matrix metallopeptidase (MMP) 3 and oxidative stress markers in the retinal pigment epithelium of Lyst mutants. Previous reports showed that impaired degradation of photoreceptor outer segment phagosomes causes elevated oxidative stress, which could consequently lead to increases of cysteine cathepsins and MMPs in the extracellular matrix. Taken together, we conclude that the loss of LYST function causes accumulation of phagosomes in the retinal pigment epithelium and elevation of several extracellular matrix-remodeling proteases through oxidative stress, which may, in turn, reduce retinal adhesion. Our work reveals previously unreported pathogenic events in the retinal pigment epithelium caused by Lyst deficiency. The same pathogenic events may be conserved in other professional phagocytic cells, such as macrophages in the immune system, contributing to overall Chediak–Higashi syndrome pathology.