Female and male glial fibrillary acidic protein-thymidine kinase (GFAP-TK) transgenic rats were made ethanol dependent via a six-week chronic intermittent ethanol vapor (CIE) and ethanol drinking (ED) procedure. During the last week of CIE, a subset of male and female TK rats was fed valcyte to ablate dividing progenitor cells and continued the diet until the end of this study. Following week six, all CIE rats experienced two weeks of forced abstinence from CIE-ED, after which they experienced relapse to drinking, extinction, and reinstatement of ethanol seeking sessions. CIE increased ED in female and male rats, with females having higher ethanol consumption during CIE and relapse sessions compared with males. In both sexes, valcyte reduced the levels of Ki-67-labeled progenitor cells in the subgranular zone of the dentate gyrus and did not alter the levels in the medial prefrontal cortex (mPFC). Valcyte increased ED during relapse, increased lever responses during extinction and, interestingly, enhanced latency to extinguish ethanol-seeking behaviors in males. Valcyte reduced the reinstatement of ethanol-seeking behaviors triggered by ethanol cues in females and males. Reduced seeking by valcyte was associated with the normalization of cytokines and chemokines in plasma isolated from trunk blood, indicating a role for progenitor cells in peripheral inflammatory responses. Reduced seeking by valcyte was associated with increases in tight junction protein claudin-5 and oligodendrogenesis in the dentate gyrus and reduction in microglial activity in the dentate gyrus and mPFC in females and males, demonstrating a role for progenitor cells in the dentate gyrus in dependence-induced endothelial and microglial dysfunction. These data suggest that progenitor cells born during withdrawal and abstinence from CIE in the dentate gyrus are aberrant and could play a role in strengthening ethanol memories triggered by ethanol cues via central and peripheral immune responses.