Preventing aberrant immune responses against the microbiota is essential for the health of the host. Microbiota-shed pathogen-associated molecular patterns translocate from the gut lumen into systemic circulation. Here, we examined the role of hemolymph (insect blood) filtration in regulating systemic responses to microbiota-derived peptidoglycan. Drosophila deficient for the transcription factor Klf15 (Klf15NN) are viable but lack nephrocytes-cells structurally and functionally homologous to the glomerular podocytes of the kidney. We found that Klf15NN flies were more resistant to infection than wild-type (WT) counterparts but exhibited a shortened lifespan. This was associated with constitutive Toll pathway activation triggered by excess peptidoglycan circulating in Klf15NN flies. In WT flies, peptidoglycan was removed from systemic circulation by nephrocytes through endocytosis and subsequent lysosomal degradation. Thus, renal filtration of microbiota-derived peptidoglycan maintains immune homeostasis in Drosophila, a function likely conserved in mammals and potentially relevant to the chronic immune activation seen in settings of impaired blood filtration.