Amyotrophic lateral sclerosis–frontotemporal dementia (ALS-FTD) constitutes a devastating disease spectrum characterized by 43-kDa TAR DNA-binding protein (TDP-43) pathology. Understanding how TDP-43 contributes to neurodegeneration will help direct therapeutic efforts. Here we have created a TDP-43 knock-in mouse with a human-equivalent mutation in the endogenous mouse Tardbp gene. TDP-43Q331K mice demonstrate cognitive dysfunction and a paucity of parvalbumin interneurons. Critically, TDP-43 autoregulation is perturbed, leading to a gain of TDP-43 function and altered splicing of Mapt, another pivotal dementia-associated gene. Furthermore, a new approach to stratify transcriptomic data by phenotype in differentially affected mutant mice revealed 471 changes linked with improved behavior. These changes included downregulation of two known modifiers of neurodegeneration, Atxn2 and Arid4a, and upregulation of myelination and translation genes. With one base change in murine Tardbp, this study identifies TDP-43 misregulation as a pathogenic mechanism that may underpin ALS-FTD and exploits phenotypic heterogeneity to yield candidate suppressors of neurodegenerative disease.