Patients with frontotemporal dementia (FTD) resulting from granulin (GRN) haploinsufficiency have reduced levels of progranulin and exhibit dysregulation in inflammatory and lysosomal networks. Microglia produce high levels of progranulin, and reduction of progranulin in microglia alone is sufficient to recapitulate inflammation, lysosomal dysfunction, and hyperproliferation in a cellautonomous manner. Therefore, targeting microglial dysfunction caused by progranulin insufficiency represents a potential therapeutic strategy to manage neurodegeneration in FTD. Limitations of current progranulin-enhancing strategies necessitate the discovery of new targets. To identify compounds that can reverse microglial defects in Grn-deficient mouse microglia, we performed a compound screen coupled with high throughput sequencing to assess key transcriptional changes in inflammatory and lysosomal pathways. Positive hits from this initial screen were then further narrowed down based on their ability to rescue cathepsin activity, a critical biochemical readout of lysosomal capacity. The screen identified nor-binaltorphimine dihydrochloride (nor-BNI) and dibutyryl-cAMP, sodium salt (DB-cAMP) as two phenotypic modulators of progranulin deficiency. In addition, nor-BNI and DB-cAMP also rescued cell cycle abnormalities in progranulin-deficient cells. These data highlight the potential of a transcription-based platform for drug screening, and advance two novel lead compounds for ftD. Progranulin, encoded by the GRN gene, is a secreted protein expressed in neurons and microglia in human 1 and mouse brains 2. Heterozygous GRN mutations lead to progranulin haploinsufficiency and result in frontotemporal dementia (FTD-GRN) 1,3 , a fatal neurodegenerative disease that initially affects behavior and language, with the typical onset from mid 40s to mid 60s 4. There are currently no treatments available for patients with FTD. Progranulin's roles in maintaining lysosomal and inflammatory homeostasis have emerged as key pathogenic drivers of FTD-GRN. Analysis of postmortem brains of patients with GRN haploinsufficiency revealed lysosomal dysfunction, evident by increased accumulation of lipofuscin 5 , undegradable lysosomal material that damages cells 6. In addition, FTD-GRN patients have altered levels of pro-inflammatory cytokines in serum and cerebrospinal fluid (CSF), such as IL-6, although whether this differentiates FTD-GRN from other causes of FTD is unclear 7,8. In a smaller study, CSF analysis revealed increased levels of IP-10 and decreased levels of IL-15 and