Accumulation of misfolded or aberrant proteins in neuronal cells is linked with neurodegeneration and other pathologies. Which molecular mechanisms fail and cause inappropriate folding of proteins and what is their relationship to cellular toxicity is not well known. How does it happen and what are the probable therapeutic or molecular approaches to counter them are also not clear. Here, we demonstrate that treatment of lanosterol diminishes aberrant proteotoxic aggregation and mitigates their cytotoxicity via induced expression of co-chaperone CHIP and elevated autophagy. The addition of lanosterol not only reduces aggregation of mutant bonafide misfolded proteins but also effectively prevents accumulation of various mutant disease-prone proteotoxic proteins. Finally, we observed that lanosterol mitigates cytotoxicity in cells, mediated by different stress-inducing agents. Taken together, our present results suggest that upregulation of cellular molecular chaperones, primarily using small molecules, can probably offer an efficient therapeutic approach in the future against misfolding of different disease-causing proteins and neurodegenerative disorders. © 2017, Springer Science+Business Media New York.