Filamentous inclusions of the microtubule-associated protein, tau, define a variety of neurodegenerative diseases known as tauopathies, including Alzheimer's disease (AD). To better understand the role of tau-mediated effects on pathophysiology and global central nervous system function, we extensively characterized gene expression, pathology and behavior of the rTg4510 mouse model, which overexpresses a mutant form of human tau that causes Frontotemporal dementia and parkinsonism linked to chromosome 17 (FTDP-17). We found that the most predominantly altered gene expression pathways in rTg4510 mice were in inflammatory processes. These results closely matched the causal immune function and microglial gene-regulatory network recently identified in AD. We identified additional gene expression changes by laser microdissecting specific regions of the hippocampus, which highlighted alterations in neuronal network activity. Expression of inflammatory genes and markers of neuronal activity changed as a function of age in rTg4510 mice and coincided with behavioral deficits. Inflammatory changes were tau-dependent, as they were reversed by suppression of the tau transgene. Our results suggest that the alterations in microglial phenotypes that appear to contribute to the pathogenesis of Alzheimer's disease may be driven by tau dysfunction, in addition to the direct effects of beta-amyloid.