The apolipoprotein E (APOE) gene is the strongest genetic risk factor for Alzheimer’s disease and directly influences tauopathy and tau-mediated neurodegeneration. ApoE4 has strong deleterious effects on both parameters. In the brain, apoE is produced and secreted primarily by astrocytes and by activated microglia. The cell-specific role of each form of apoE in the setting of neurodegeneration has not been determined. We generated P301S Tau/Aldh1l1-CreERT2/apoE3flox/flox or Tau/Aldh1l1-CreERT2/apoE4flox/flox mice. At 5.5 months of age, after the onset of tau pathology, we administered tamoxifen or vehicle and compared mice at 9.5 months of age. Removing astrocytic APOE4 markedly reduced tau-mediated neurodegeneration and decreased phosphorylated tau (pTau) pathology. Single-nucleus RNA sequencing analysis revealed striking gene expression changes in all cell types, with astrocytic APOE4 removal decreasing disease-associated gene signatures in neurons, oligodendrocytes, astrocytes, and microglia. Removal of astrocytic APOE4 decreased tau-induced synaptic loss and microglial phagocytosis of synaptic elements, suggesting a key role for astrocytic apoE in synaptic degeneration.