Autosomal dominant mutations of the RNA/DNA binding protein FUS are linked to familial amyotrophic lateral sclerosis (FALS); however, it is not clear how FUS mutations cause neurodegeneration. Using transgenic mice expressing a common FALS-associated FUS mutation (FUS-R521C mice), we found that mutant FUS proteins formed a stable complex with WT FUS proteins and interfered with the normal interactions between FUS and histone deacetylase 1 (HDAC1). Consequently, FUS-R521C mice exhibited evidence of DNA damage as well as profound dendritic and synaptic phenotypes in brain and spinal cord. To provide insights into these defects, we screened neural genes for nucleotide oxidation and identified brain-derived neurotrophic factor (Bdnf) as a target of FUS-R521C-associated DNA damage and RNA splicing defects in mice. Compared with WT FUS, mutant FUS-R521C proteins formed a more stable complex with Bdnf RNA in electrophoretic mobility shift assays. Stabilization of the FUS/Bdnf RNA complex contributed to Bdnf splicing defects and impaired BDNF signaling through receptor TrkB. Exogenous BDNF only partially restored dendrite phenotype in FUS-R521C neurons, suggesting that BDNF-independent mechanisms may contribute to the defects in these neurons. Indeed, RNA-seq analyses of FUS-R521C spinal cords revealed additional transcription and splicing defects in genes that regulate dendritic growth and synaptic functions. Together, our results provide insight into how gain-of-function FUS mutations affect critical neuronal functions.