Microglia are the primary immune cells in the central nervous system, which plays a vital role in neuron development and neurodegenerative diseases. Microglial precursors in peripheral hematopoietic tissues colonize the central nervous system during early embryogenesis. However, how intrinsic and extrinsic signals integrate to regulate microglia's differentiation remains undefined. In this study, we identified the cerebral white matter hyperintensities susceptibility gene, programmed cell death protein 11 (PDCD11), as an essential factor regulating microglia differentiation. In zebrafish, pdcd11 deficiency prevents the differentiation of the precursors to mature brain microglia. Although, the inflammatory featured macrophage brain colonization is augmented. At 22 h post fertilization, the Pdcd11-positive cells on the yolk sac are distinct from macrophages and neutrophils. Mechanistically, PDCD11 exerts its physiological role by differentially regulating the functions of nuclear factor-kappa B family members, P65 and c-Rel, suppressing P65-mediated expression of inflammatory cytokines, such as tnfα, and enhancing the c-Rel-dependent appearance of tgfβ1. The present study provides novel insights in understanding microglia differentiation during zebrafish development.