Metachromatic leukodystrophy (MLD) is a demyelinating lysosomal storage disorder for which new treatments are urgently needed. We previously showed that transplantation of gene-corrected hematopoietic stem progenitor cells (HSPCs) in presymptomatic myeloablated MLD mice prevented disease manifestations. Here we show that HSC gene therapy can reverse neurological deficits and neuropathological damage in affected mice, thus correcting an overt neurological disease. The efficacy of gene therapy was dependent on and proportional to arylsulfatase A (ARSA) overexpression in the microglia progeny of transplanted HSPCs. We demonstrate a widespread enzyme distribution from these cells through the CNS and a robust cross-correction of neurons and glia in vivo. Conversely, a peripheral source of enzyme, established by transplanting ARSA-overexpressing hepatocytes from transgenic donors, failed to effectively deliver the enzyme to the CNS. These results indicate that the recruitment of gene-modified, enzyme-overexpressing microglia makes the enzyme bioavailable to the brain and makes therapeutic efficacy and disease correction attainable. Overall, our data provide a strong rationale for implementing HSPC gene therapy in MLD patients.