Astrocytes provide metabolic support to neurons, maintain ionic and water homeostasis, and uptake and recycle neurotransmitters. After exposure to the prototypical PAMP lipopolysaccharide (LPS), reactive astrocytes increase the expression of pro-inflammatory genes, facilitating neurodegeneration. In this study, we analyzed the expression of homeostatic genes in astrocytes exposed to LPS and identified the epigenetic factors contributing to the suppression of homeostatic genes in reactive astrocytes. Primary astrocytic cultures were acutely exposed to LPS and allowed to recover for 24, 72 h, and 7 days. As expected, LPS exposure induced reactive astrogliosis and increased the expression of pro-inflammatory IL-1B and IL-6. Interestingly, the acute exposure resulted in persistent hypermethylation of astroglial DNA. Similar hypermethylation was observed in highly reactive astrocytes from the traumatic brain injury (TBI) penumbra invivo. Hypermethylation was accompanied by decreased expression of homeostatic genes including LDHA and Scl16a1 (MCT1) both involved in the lactate shuttle to neurons; glutamine synthase (GS) responsible for glutamate processing; Kcnj10 (Kir4.1) important for K+ homeostasis, and the water channel aquaporin-4 (Aqp4). Furthermore, the master regulator of DNA methylation, MAFG-1, as well as DNA methyl transferases DNMT1 and DNMT3a were overexpressed. The downregulation of homeostatic genes correlated with increased methylation of CpG islands in their promoters, as assessed by methylation-sensitive PCR and increased DNMT3a binding to the GS promoter. Treatment with decitabine, a DNMT inhibitor, prevented the LPS- and the HMGB-1-induced downregulation of homeostatic genes. Decitabine treatment also prevented the neurotoxic effects of these astrocytes in primary cortical cultures. In summary, our findings reveal that the pathological remodeling of reactive astrocytes encompasses not only the pro-inflammatory response but, significantly, also entails a long-term suppression of homeostatic gene expression with methylation of crucial CpG islands within their promoters.