Transposable elements, known colloquially as 'jumping genes', constitute approximately 45% of the human genome. Cells utilize epigenetic defenses to limit transposable element jumping, including formation of silencing heterochromatin and generation of piwi-interacting RNAs (piRNAs), small RNAs that facilitate clearance of transposable element transcripts. Here we utilize Drosophila melanogaster and postmortem human brain samples to identify transposable element dysregulation as a key mediator of neuronal death in tauopathies, a group of neurodegenerative disorders that are pathologically characterized by deposits of tau protein in the brain. Mechanistically, we find that heterochromatin decondensation and reduction of piwi and piRNAs drive transposable element dysregulation in tauopathy. We further report a significant increase in transcripts of the endogenous retrovirus class of transposable elements in human Alzheimer's disease and progressive supranuclear palsy, suggesting that transposable element dysregulation is conserved in human tauopathy. Taken together, our data identify heterochromatin decondensation, piwi and piRNA depletion and consequent transposable element dysregulation as a pharmacologically targetable, mechanistic driver of neurodegeneration in tauopathy.