Multiple Sclerosis (MS) is a chronic autoimmune inflammatory disorder of the central nervous system (CNS). Current therapies mainly target inflammatory processes during acute stages, but effective treatments for progressive MS are limited. In this context, astrocytes have gained increasing attention as they have the capacity to drive, but also suppress tissue-degeneration. Here we show that astrocytes upregulate the immunomodulatory checkpoint molecule PD-L1 during acute autoimmune CNS inflammation in response to aryl hydrocarbon receptor and interferon signaling. Using CRISPR-Cas9 genetic perturbation in combination with small-molecule and antibody-mediated inhibition of PD-L1 and PD-1 both in vivo and in vitro, we demonstrate that astrocytic PD-L1 and its interaction with microglial PD-1 is required for the attenuation of autoimmune CNS inflammation in acute and progressive stages in a mouse model of MS. Our findings suggest the glial PD-L1/PD-1 axis as a potential therapeutic target for both acute and progressive MS stages.