The double-stranded RNA-binding protein Staufen1 (STAU1) regulates a variety of physiological and pathological events via mediating RNA metabolism. STAU1 overabundance was observed in tissues from mouse models and fibroblasts from patients with neurodegenerative diseases, accompanied by enhanced mTOR signaling and impaired autophagic flux, while the underlying mechanism remains elusive. Here, we find that endogenous STAU1 forms dynamic cytoplasmic condensate in normal and tumor cell lines, as well as in mouse Huntington's disease knockin striatal cells. STAU1 condensate recruits target mRNA MTOR at its 5'UTR and promotes its translation both in vitro and in vivo, and thus enhanced formation of STAU1 condensate leads to mTOR hyperactivation and autophagy-lysosome dysfunction. Interference of STAU1 condensate normalizes mTOR levels, ameliorates autophagy-lysosome function, and reduces aggregation of pathological proteins in cellular models of neurodegenerative diseases. These findings highlight the importance of balanced phase separation in physiological processes, suggesting that modulating STAU1 condensate may be a strategy to mitigate the progression of neurodegenerative diseases with STAU1 overabundance.