ABSTRACT Neuropsychiatric manifestations are common in both the acute and post-acute phase of SARS-CoV-2 infection, but the mechanisms of these effects are unknown. In a newly established brain organoid model with innately developing microglia, we demonstrate that SARS-CoV-2 infection causes an extensive cell death and loss of post-synaptic termini. Despite limited neurotropism and a decelerating viral replication, we observe a threefold increase in microglial engulfment of postsynaptic termini after SARS-CoV-2 exposure. We define the microglial responses to SARS-CoV-2 infection by single cell transcriptomic profiling and observe an upregulation of interferon-responsive genes as well as genes promoting migration and synaptic stripping. To a large extent, SARS-CoV-2 exposed microglia display a transcriptomic profile previously observed in neurodegenerative disorders characterized by early a synapse loss and an increased incident risk after a Covid-19 infection. Our results reveal that brain organoids infected with SARS-CoV-2 display disruption in circuit integrity via microglia-mediated synapse elimination and identifies a potential novel mechanism contributing to cognitive impairments in patients recovering from Covid-19.