Introduction: Danon disease is an X-linked cardiomyopathy caused by mutations in the lysosomal associated membrane protein 2 (LAMP2). LAMP2 plays a critical role in autophagy, but the mechanisms in which mutations lead to myocyte dysfunction are poorly understood. We identified a novel frame shift mutation that introduces a premature termination codon (PTC) in the LAMP2 gene in a patient with Danon disease. Degradation of PTC-containing mRNA transcripts by nonsense mediated decay (NMD) has been shown in a variety of heart diseases. We hypothesized that 1) the mechanism of LAMP2 dysfunction in this patient is NMD mediated, and 2) induced Pluripotent Stem (iPS) cell-derived myocytes generated from these fibroblasts would show evidence of impaired autophagy. Methods: Dermal fibroblast lines were established from a patient with Danon disease and used for RNA and protein assays. Fibroblasts were subsequently used to create iPS cell-derived cardiomyocytes using previously described techniques. Immunohistochemistry and protein gel electrophoresis of the autophagosome associated protein, LC3-II, were used to assay for autophagic function. Ultrastructural studies were performed using electron microscopy. Results: Patient fibroblasts were shown to completely lack the LAMP2 protein. Treatment with the protein synthesis inhibitor cyclohexamide stabilized LAMP2 mRNA levels, suggesting this LAMP2 mutation is targeted by NMD. Compared to wild type cells, Danon disease iPS-derived cells demonstrated reduced basal levels of the autophagosome-associated protein LC3-II, suggestive of impaired autophagy. Electron microscopy of iPS cells showed excessive intracytoplasmic vacuoles consistent with the disease phenotype. Conclusions: We have successfully created the first in vitro human model of Danon disease. Using this system, we identified NMD as a novel mechanism responsible for LAMP2 dysfunction in a patient with Danon disease. Furthermore, we confirmed the critical role of LAMP2 in the regulation of autophagy. This study highlights the utility of this in vitro system for elucidating the pathophysiology of inherited cardiovascular disease.