A sheet stacking apparatus which is capable of efficiently stacking sheets of various sizes while making efficient use of space therein to realizing compactness of the apparatus. Stacker trays that are driven by respective tray lift motors perform a lifting/lowering operation to have sheets stacked thereon. Selection is made according to the size of sheets between a first stacking mode for stacking sheets having a size not larger than a predetermined size on one of the stacker trays and a second stacking mode for stacking sheets having a size larger than the predetermined size in a state extending on the stacker trays. When it is determined that one of the stacker trays is faulty, execution of the second stacking mode is inhibited, and execution of the first stacking mode using the other stacker tray is permitted.