PROJECT SUMMARY Dominant mutations in the human GRN gene cause haploinsufficiency in Progranulin (PGRN) protein levels and are a leading cause of frontotemporal lobar degeneration with aggregation of RNA binding protein TDP-43 (FTLD-TDP). In addition, single nucleotide polymorphism (SNP) in GRN has been identified as a risk factor for AD and Limbic predominant, Age-related TDP-43 Encephalopathy (LATE), a major cause of memory impairments in patients over 90 years old. Despite the critical role of PGRN in brain aging, however, the exact mechanism by which PGRN haploinsufficiency promotes neurodegeneration remains poorly understood. By analyzing aging cohorts of Grn knockout (Grn-/-) and humanized GrnR493X/R493X knockin mice, we have shown that PGRN-deficient microglia produce more complement proteins and pro-inflammatory cytokines to promote neuronal cell death and TDP-43 proteinopathy during brain aging. Interestingly, our ongoing work shows that blocking complement activation and proinflammatory cytokines TNFa and IL-1a does not completely mitigate neurodegeneration, but rather uncover late-onset microglial pathology characterized by profound accumulation of lipids in Grn-/-, Grn-/-;C1qa-/-;C3-/-, and Grn-/-;C1qa-/-;Tnf-/-;Il1a-/- microglia. Using lipidomics and subcellular fractionation, we further show that loss of PGRN causes severe blockade in the endolysosomal trafficking of lipids in Grn-/- microglia, which interferes with lysosome-mediated degradation of lipid droplets and increased production of proinflammatory oxidized phospholipids. Together, our results broach the hypothesis that PGRN deficiency causes profound endolysosomal trafficking defects of lipids in microglia and astrocytes to promote neuronal vulnerability in neurodegeneration. To test this hypothesis, we propose to (1) delineate the mechanism of endolysosomal trafficking and secretory autophagy that promote lipid-mediated toxicity in Grn-/- microglia, (2) characterize the role of lipid-dependent and -independent mechanisms in promoting neurotoxicity in Grn-/- astrocytes, and (3) delineate the contributions of lipids to glial toxicity in FTLD-GRN using comparative snRNA- seq, IPSC-derived organoids and postmortem tissues. The proposed parallel human-mouse studies will uncover the contributions of lipid-mediated toxicity in highly disease vulnerable regions in Grn-/- mice and FTLD-GRN will uncover critical mechanisms that promote glial pathology and neurodegeneration during brain aging and lead to novel therapeutic targets for ADRD.