Huntington's disease is characterized by accumulation of the aggregation-prone mutant Huntingtin (mHTT) protein. Here, we show that expression of exon 1 of mHTT in mouse cultured cells activates IRE1, the transmembrane sensor of stress in the endoplasmic reticulum, leading to degradation of the Blos1 mRNA and repositioning of lysosomes and late endosomes toward the microtubule organizing center. Overriding Blos1 degradation results in excessive accumulation of mHTT aggregates in both cultured cells and primary neurons. Although mHTT is degraded by macroautophagy when highly expressed, we show that before the formation of large aggregates, mHTT is degraded via an ESCRT-dependent, macroautophagy-independent pathway consistent with endosomal microautophagy. This pathway is enhanced by Blos1 degradation and appears to protect cells from a toxic, less aggregated form of mHTT.