Cholesterol is an essential membrane structural component and steroid hormone precursor, and is involved in numerous signaling processes. Astrocytes regulate brain cholesterol homeostasis and they supply cholesterol to the needs of neurons. ATP-binding cassette transporter A1 (ABCA1) is the main cholesterol efflux transporter in astrocytes. Here we show dysregulated cholesterol homeostasis in astrocytes generated from human induced pluripotent stem cells (iPSCs) derived from males with fragile X syndrome (FXS), which is the most common cause of inherited intellectual disability. ABCA1 levels are reduced in FXS human and mouse astrocytes when compared with controls. Accumulation of cholesterol associates with increased desmosterol and polyunsaturated phospholipids in the lipidome of FXS mouse astrocytes. Abnormal astrocytic responses to cytokine exposure together with altered anti-inflammatory and cytokine profiles of human FXS astrocyte secretome suggest contribution of inflammatory factors to altered cholesterol homeostasis. Our results demonstrate changes of astrocytic lipid metabolism, which can critically regulate membrane properties and affect cholesterol transport in FXS astrocytes, providing target for therapy in FXS.