Dysregulated neurite outgrowth and synapse formation underlie many psychiatric disorders, which are also manifested by wolfram syndrome (WS). Whether and how the causative geneWFS1deficiency affects synapse formation remain elusive. By mirroring human brain development with cerebral organoids,WFS1-deficient cerebral organoids not only recapitulate the neuronal loss in WS patients, but also exhibit significantly impaired synapse formation and function associated with reduced astrocytes.WFS1deficiency in neurons autonomously delays neuronal differentiation with altered expressions of genes associated with psychiatric disorders, and impairs neurite outgrowth and synapse formation with elevated cytosolic calcium. Intriguingly,WFS1deficiency in astrocytes decreases the expression of glutamate transporterEAAT2by NF-κB activation and induces excessive glutamate. When co-cultured with wildtype neurons,WFS1-deficient astrocytes lead to impaired neurite outgrowth and increased cytosolic calcium in neurons. Importantly, disrupted synapse formation and function inWFS1-deficient cerebral organoids and impaired neurite outgrowth affected byWFS1-deficient astrocytes are efficiently reversed with Riluzole treatment, by restoringEAAT2expression in astrocytes. Furthermore, Riluzole rescues the depressive-like behavior in the forced swimming test and the impaired recognition and spatial memory in the novel object test and water maze test inWfs1conditional knockout mice. Altogether, our study provides novel insights into howWFS1deficiency affects synapse formation and function, and offers a strategy to treat this disease.