Studies on MECP2 function and its implications in Rett Syndrome (RTT) have traditionally centered on neurons. Here, using human embryonic stem cell (hESC) lines, we modeled MECP2 loss-of-function to explore its effects on astrocyte (AST) development and dysfunction in the brain. Ultrastructural analysis of RTT hESC-derived cerebral organoids revealed significantly smaller mitochondria compared to controls (CTRs), particularly pronounced in glia versus neurons. Employing a multiomics approach, we observed increased gene expression and accessibility of a subset of nuclear-encoded mitochondrial genes upon mutation of MECP2 in ASTs compared to neurons. Analysis of hESC-derived ASTs showed reduced mitochondrial respiration and altered key proteins in the tricarboxylic acid cycle and electron transport chain in RTT versus CTRs. Additionally, RTT ASTs exhibited increased cytosolic amino acids under basal conditions, which were depleted upon increased energy demands. Notably, mitochondria isolated from RTT ASTs exhibited increased reactive oxygen species and influenced neuronal activity when transferred to cortical neurons. These findings underscore MECP2 mutation's differential impact on mitochondrial and metabolic pathways in ASTs versus neurons, suggesting that dysfunctional AST mitochondria may contribute to RTT pathophysiology by affecting neuronal health.