Hyperactivity of microglia and loss of functional circuitry is a common feature of many neurological disorders including those induced or exacerbated by inflammation. Herein, we investigate the response of microglia and changes in hippocampal dendritic postsynaptic spines by dendritic polyglycerol sulfate (dPGS) treatment. Mouse microglia and organotypic hippocampal slices were exposed to dPGS and an inflammogen (lipopolysaccharides). Measurements of intracellular fluorescence and confocal microscopic analyses revealed that dPGS is avidly internalized by microglia but not CA1 pyramidal neurons. Concentration and time-dependent response studies consistently showed no obvious toxicity of dPGS. The adverse effects induced by proinflammogen LPS exposure were reduced and dendritic spine morphology was normalized with the addition of dPGS. This was accompanied by a significant reduction in nitrite and proinflammatory cytokines (TNF-α and IL-6) from hyperactive microglia suggesting normalized circuitry function with dPGS treatment. Collectively, these results suggest that dPGS acts anti-inflammatory, inhibits inflammation-induced degenerative changes in microglia phenotype and rescues dendritic spine morphology.