Macrophages are a key and heterogenous class of phagocytic cells of the innate immune system, which act as sentinels in peripheral tissues and are mobilized during infection. Macrophage activation in the presence of bacterial cells and molecules entails specific and complex programs of gene expression. How such triggers elicit the gene expression programs is incompletely understood. We previously discovered that transcription factor TFEB is a key contributor to macrophage activation during bacterial phagocytosis. However, the mechanism linking phagocytosis of bacterial cells to TFEB activation remained unknown. In this article, we describe a previously unknown pathway that links phagocytosis with the activation of TFEB and related transcription factor TFE3 in macrophages. We find that phagocytosis of bacterial cells causes an NADPH oxidase (PHOX)-dependent oxidative burst, which activates enzyme CD38 and generates NAADP in the maturing phagosome. Phago-lysosome fusion brings Ca2+ channel TRPML1/MCOLN1 in contact with NAADP, causing Ca2+ efflux from the lysosome, calcineurin activation, and TFEB nuclear import. This drives TFEB-dependent expression of important pro-inflammatory cytokines, such as IL-1α, IL-1β, and IL-6. Thus, our findings reveal that TFEB activation is a key regulatory event for the activation of macrophages. These findings have important implications for infections, cancer, obesity, and atherosclerosis.