Here, using human-induced pluripotent stem cell–derived microglia-like cells (hiPSC-MG) harboring the most common ALS/FTD mutation (C9orf72, mC9-MG), gene-corrected isogenic controls (isoC9-MG), and C9orf72 knockout hiPSC-MG (C9KO-MG), we show that reduced C9ORF72 protein is associated with impaired phagocytosis and an exaggerated immune response upon stimulation with lipopolysaccharide. Here, C9orf72 is linked to amyotrophic lateral sclerosis.