In nervous system development, disease and injury, neurons undergo programmed cell death, leaving behind cell corpses that are removed by phagocytic glia. Altered glial phagocytosis has been implicated in several neurological diseases including Alzheimer's disease, Parkinson's disease, and traumatic brain injury. To untangle the links between glial phagocytosis and neurodegeneration, we investigated Drosophila mutants lacking the phagocytic receptor Draper. Loss of Draper leads to persistent neuronal cell corpses and age-dependent neurodegeneration. Here we investigate whether the phagocytic defects observed in draper mutants lead to chronic increased immune activation that promotes neurodegeneration. A major immune response in Drosophila is the activation of two NFκB signaling pathways that produce antimicrobial peptides, primarily in the fat body. We found that the antimicrobial peptide Attacin-A is highly upregulated in the fat body of aged draper mutants and that inhibition of the Immune deficiency (Imd) pathway in the glia and fat body of draper mutants led to reduced neurodegeneration, indicating that immune activation promotes neurodegeneration in draper mutants. Taken together, these findings indicate that phagocytic defects lead to neurodegeneration via increased immune signaling, both systemically and locally in the brain.