Traumatic brain injury (TBI) is the leading cause of death in the pediatric stage, with detrimental consequences including psychosocial issues, cognitive deficits and motor abnormalities. In addition to the primary TBI impact, the subsequent neuroinflammatory response can become a contributing and even leading factor to the harmful effect of pediatric TBI on the brain. As such, finding ways to stabilize the reactive microglial phenotype is a key objective for TBI treatment. One potential factor is the neuropeptide oxytocin. Oxytocin has shown to be neuroprotective in adult neuroinflammatory states, but the mechanisms of effect remain largely unknown, as does its applicability to the pediatric phase. In the current study, we assessed the neuroprotective potential of neuronal oxytocin on microglial reactivity in a mouse model of pediatric TBI. A pediatric TBI model of weight-drop impact acceleration injury was administered to P7 C57BL/6N male mice, which induced a robust inflammatory response in the brain. Treatment with increased oxytocin activity via the Oxt-Hm3Dq DREADD construct reversed the pro-inflammatory effect on microgliosis, and microglial morphology at P8. Functional ultrasound assessment showed a disturbance to inter- and interhemispheric brain connectivity in P45 TBI animals, which was partially rescued by oxytocin treatment. Finally, microglia RNA sequencing revealed putative pathways between oxytocin and its anti-inflammatory effect on microglia. Our results support that endogenous oxytocin can be a potential protective agent for pediatric TBI by dampening the neuroinflammatory response in microglia and preserving healthy brain development.