Paired Immunoglobulin-like Type 2 Receptor Alpha (PILRA) is a cell surface inhibitory receptor that recognizes specific O-glycosylated proteins and is expressed on various innate immune cell types including microglia. We show here that a common missense variant (G78R, rs1859788) of PILRA is the likely causal allele for the confirmed Alzheimer's disease risk locus at 7q21 (rs1476679). The G78R variant alters the interaction of residues essential for sialic acid engagement, resulting in >50% reduced binding for several PILRA ligands including a novel ligand, complement component 4A, and herpes simplex virus 1 (HSV-1) glycoprotein B. PILRA is an entry receptor for HSV-1 via glycoprotein B, and macrophages derived from R78 homozygous donors showed significantly decreased levels of HSV-1 infection at several multiplicities of infection compared to homozygous G78 macrophages. We propose that PILRA G78R protects individuals from Alzheimer's disease risk via reduced inhibitory signaling in microglia and reduced microglial infection during HSV-1 recurrence.