Expansions of a hexanucleotide repeat (GGGGCC) in the noncoding region of the C9orf72 gene are the most common genetic cause of amyotrophic lateral sclerosis (ALS) and frontotemporal dementia. Decreased expression of C9orf72 is seen in expansion carriers, suggesting that loss of function may play a role in disease. We found that two independent mouse lines lacking the C9orf72 ortholog (3110043O21Rik) in all tissues developed normally and aged without motor neuron disease. Instead, C9orf72 null mice developed progressive splenomegaly and lymphadenopathy with accumulation of engorged macrophage-like cells. C9orf72 expression was highest in myeloid cells, and the loss of C9orf72 led to lysosomal accumulation and altered immune responses in macrophages and microglia, with age-related neuroinflammation similar to C9orf72 ALS but not sporadic ALS human patient tissue. Thus, C9orf72 is required for the normal function of myeloid cells, and altered microglial function may contribute to neurodegeneration in C9orf72 expansion carriers.