Gain-of-function (GOF) mutations in CXCR4 cause WHIM (warts, hypogammaglobulinemia, infections, and myelokathexis) syndrome, characterized by infections, leukocyte retention in bone marrow (BM), and blood leukopenias. B lymphopenia is evident at early progenitor stages, yet why do CXCR4 GOF mutations that cause B (and T) lymphopenia remain obscure? Using a CXCR4 R334X GOF mouse model of WHIM syndrome, we showed that lymphopoiesis is reduced because of a dysregulated mesenchymal stem cell (MSC) transcriptome characterized by a switch from an adipogenic to an osteolineage-prone program with limited lymphopoietic activity. We identify lymphotoxin beta receptor (LTβR) as a critical pathway promoting interleukin-7 (IL-7) down-regulation in MSCs. Blocking LTβR or CXCR4 signaling restored IL-7 production and B cell development in WHIM mice. LTβR blocking also increased production of IL-7 and B cell activating factor (BAFF) in secondary lymphoid organs (SLOs), increasing B and T cell numbers in the periphery. These studies revealed that LTβR signaling in BM MSCs and SLO stromal cells limits the lymphocyte compartment size.