Inducing tumor cell death is one of the major therapeutic strategies in treating cancer. The aim of this study is to investigate the mechanism underlying the involvement of autophagy in cell death induced by timosaponin AIII (TAIII). Cell viability was determined by MTT and cologenic assay; apoptosis was determined by flow cytometry and TUNEL assay; autophagy was examined by immunoblotting and immunofluorescence; ubiquitination was detected by co-immunoprecipitation; mRNA expression was detected by real-time PCR; and determination of necrotic cell death was approached with LDH assay. The in vivo tumor growth inhibition was determined by xenograft model. TAIII exhibits potent cytotoxicity on human hepatocellular carcinoma (HCC) cells without severe hepatic toxicity. TAIII induced caspase-dependent apoptosis in HCC, and the induction of apoptosis was attributed to the inhibition of TAIII on XIAP expression. Repressing XIAP expression allowed cell tolerance toward the treatment with TAIII. The suppression of XIAP by TAIII is under post-transcriptional control and independent of proteasomal-driven proteolysis. Instead, TAIII-induced AMPKα/mTOR-dependent autophagy was responsible for XIAP suppression and triggered the XIAP heading lysosomal degradation pathway. Ubiquitination of IAPs is required for the autophagic degradation induced by TAIII. Blockade of autophagy turns on the switch of necrotic cell death in TAIII-treated cells. Timosaponin AIII induces HCC cell apoptosis through a p53-independent mechanism involving XIAP degradation through autophagy-lysosomal pathway. The possibility of developing TAIII as a new anti-tumor agent is worth considering.