The endolysosomal system comprises a dynamic constellation of vesicles working together to sense and interpret environmental cues and facilitate homeostasis. Integrating extracellular information with the internal affairs of the cell requires endosomes and lysosomes to be proficient in decision-making: fusion or fission; recycling or degradation; fast transport or contacts with other organelles. To effectively discriminate between these options, the endolysosomal system employs complex regulatory strategies that crucially rely on reversible post-translational modifications (PTMs) with ubiquitin (Ub) and ubiquitin-like (Ubl) proteins. The cycle of conjugation, recognition and removal of different Ub- and Ubl-modified states informs cellular protein stability and behavior at spatial and temporal resolution and is thus well suited to finetune macromolecular complex assembly and function on endolysosomal membranes. Here, we discuss how ubiquitylation (also known as ubiquitination) and its biochemical relatives orchestrate endocytic traffic and designate cargo fate, influence membrane identity transitions and support formation of membrane contact sites (MCSs). Finally, we explore the opportunistic hijacking of Ub and Ubl modification cascades by intracellular bacteria that remodel host trafficking pathways to invade and prosper inside cells.