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Enlargement of the cerebrospinal fluid (CSF)-filled brain ventricles (ventriculomegaly) is a defining feature of congenital hydrocephalus (CH) and an under-recognized concomitant of autism. Here, we show that de novo mutations in the autism risk gene PTEN are among the most frequent monogenic causes of CH and primary ventriculomegaly. Mouse Pten-mutant ventriculomegaly results from aqueductal stenosis due to hyperproliferation of periventricular Nkx2.1 neural progenitor cells (NPCs) and increased CSF production from hyperplastic choroid plexus. Pten-mutant ventriculomegalic cortices exhibit network dysfunction from increased activity of Nkx2.1 NPC-derived inhibitory interneurons. Raptor deletion or postnatal everolimus treatment corrects ventriculomegaly, rescues cortical deficits and increases survival by antagonizing mTORC1-dependent Nkx2.1 NPC pathology. Thus, PTEN mutations concurrently alter CSF dynamics and cortical networks by dysregulating Nkx2.1 NPCs. These results implicate a nonsurgical treatment for CH, demonstrate a genetic association of ventriculomegaly and ASD, and help explain neurodevelopmental phenotypes refractory to CSF shunting in select individuals with CH.