Microglia are the resident mononuclear phagocytic immune cells of the central nervous system (CNS), and are primarily responsible for responding to neural insults and disposing of cellular debris. However, over the last decade studies are showing that microglia are highly dynamic cells involved in various critical neurodevelopmental processes. We set out to study microglia dynamics in the embryonic hypothalamus given that the hypothalamus is responsive to external stressors and critical for maintaining homeostatic processes such as energy balance, thirst, food intake, reproduction, and circadian rhythms. Using slice culture and time-lapse imaging we showed that hypothalamic microglia are highly dynamic during embryogenesis, constantly surveying their environment and often interacting with radial glia precursor cells that line the third ventricle and are responsible for generating hypothalamic neurons, oligodendrocytes, astrocytes, and tanycytes. Moreover, given that microglia colonize the embryonic brain alongside key steps of hypothalamic development, we wanted to test whether microglia are required for the proper establishment of this brain region. To eliminate microglia from the fetal brain, we treated pregnant dams with the Colony-stimulating factor-1 (Csf1r) inhibitor PLX5622, as Csf1r is expressed by microglia and is required for their proliferation, differentiation, and survival. Embryonic microglia depletion resulted in a decreased litter size, as well as an increase in the number of pups that died within the first two postnatal days of life. In pups that survived, the elimination of microglia in the fetal brain resulted in a decrease in the number of Pro-opiomelanocortin (POMC) neurons and a concomitant accelerated weight gain, suggesting that microglia could be important for the development of hypothalamic satiety centers. Depletion of microglia during embryogenesis also had long-term sex-specific effects on behaviour. Furthermore, hypothalamic microglia appear to be sensitive to the endocrine disruptor Bisphenol A during embryogenesis. Taken together, these data demonstrate an important role for microglia during the development of the embryonic hypothalamus.