C9orf72 repeat expansions cause inherited amyotrophic lateral sclerosis (ALS)/frontotemporal dementia (FTD) and result in both loss of C9orf72 protein expression and production of potentially toxic RNA and dipeptide repeat proteins. In addition to ALS/FTD, C9orf72 repeat expansions have been reported in a broad array of neurodegenerative syndromes, including Alzheimer's disease. Here we show that C9orf72 deficiency promotes a change in the homeostatic signature in microglia and a transition to an inflammatory state characterized by an enhanced type I IFN signature. Furthermore, C9orf72-depleted microglia trigger age-dependent neuronal defects, in particular enhanced cortical synaptic pruning, leading to altered learning and memory behaviors in mice. Interestingly, C9orf72-deficient microglia promote enhanced synapse loss and neuronal deficits in a mouse model of amyloid accumulation while paradoxically improving plaque clearance. These findings suggest that altered microglial function due to decreased C9orf72 expression directly contributes to neurodegeneration in repeat expansion carriers independent of gain-of-function toxicities.