Exploration of genome organization and function in the HIV infected brain is critical to aid in the understanding and development of treatments for HIV-associated neurocognitive disorder (HAND). Here, we applied a multiomic approach, including single nuclei transcriptomics, cell-type specific Hi-C 3D genome mapping, and viral integration site sequencing (IS-seq) to frontal lobe tissue from HIV-infected individuals with encephalitis (HIVE) and without encephalitis (HIV+). We observed reorganization of open/repressive (A/B) compartment structures in HIVE microglia encompassing 6.4% of the genome with enrichment for regions containing interferon (IFN) pathway genes. 3D genome remodeling was associated with transcriptomic reprogramming, including down-regulation of cell adhesion and synapse-related functions and robust activation of IFN signaling and cell migratory pathways, and was recapitulated by IFN-g stimulation of cultured microglial cells. Microglia from HIV+ brains showed, to a lesser extent, similar transcriptional alterations. IS-seq recovered 1,221 integration sites in the brain that were enriched for chromosomal domains newly mobilized into a permissive chromatin environment in HIVE microglia. Viral transcription, which was detected in 0.003% of all nuclei in HIVE brain, occurred in a subset of highly activated microglia that drove differential expression in HIVE. Thus, we observed a dynamic interrelationship of interferon-associated 3D genome and transcriptome remodeling with HIV integration and transcription in the brain.