A bstract The lifetimes of bottom and charmed hadrons are analyzed within the framework of the heavy quark expansion (HQE). Lifetime differences arise from the spectator effects such as weak W -annihilation and Pauli interference. Spectator effects originating from dimension-7 four-quark operators are derived. Hadronic matrix elements of four-quark operators are parameterized in a model-independent way. Using the dimension-6 bag parameters recently determined from HQET sum rules and the vacuum insertion approximation for meson matrix elements of dimension-7 operators, the calculated B meson lifetime ratios τ ( B + )/ τ ( B d 0 ) = 1.074 − 0.016 + 0.017 and τ ( B s 0 )/ τ ( B d 0 ) = 0.9962 ± 0.0024 are in excellent agreement with experiment. Likewise, based on the quark model evaluation of baryon matrix elements, the resulting baryon lifetime ratios τ (Ξ b − )/ τ (Λ b 0 ),  τ (Ξ b − )/ τ ( Ξ b 0 ),  τ (Ω b − )/ τ ( Ξ b − ) and the Λ b − B 0 lifetime ratio τ (Λ b 0 )/ τ ( B d 0 ) = 0.953 also agree well with the data. Contrary to the bottom hadron sector where the HQE in 1/ m b works well, the HQE to 1/ m c 3 fails to give a satisfactory description of the lifetimes of both charmed mesons and charmed baryons. This calls for the subleading 1/ m Q corrections to spectator effects. The relevant dimension-7 spectator effects are in the right direction for explaining the large lifetime ratio of τ (Ξ c + )/ τ (Λ c + ). However, the destructive 1/ m c corrections to Γ(Ω c 0 ) are too large to justify the validity of the HQE, namely, the predicted Pauli interference and semileptonic rates for Ω c 0 become negative. Demanding these rates to be positive for a sensible HQE, we find the lifetime pattern τ (Ξ c + ) >  τ ( Ω c 0 ) >  τ (Λ c + ) >  τ (Ξ c 0 ), contrary to the current hierarchy τ (Ξ c + ) >  τ (Λ c + ) >  τ (Ξ c 0 ) >  τ ( Ω c 0 ). We conclude that the Ω c 0 , which is naively expected to be shortest-lived in the charmed baryon system owing to the large constructive Pauli interference, could live longer than the Λ c + due to the suppression from 1/ m c corrections arising from dimension-7 four-quark operators. The new charmed baryon lifetime pattern needs to be tested in forthcoming experiments.