Glial engulfment of neuron-derived debris after trauma, during development, and in neurodegenerative diseases supports nervous system functions. However, mechanisms governing the efficiency of debris degradation in glia have remained largely unexplored. Here we show that LC3-associated phagocytosis (LAP), an engulfment pathway assisted by certain autophagy factors, promotes glial phagosome maturation in the Drosophila wing nerve. A LAP-specific subset of autophagy-related genes is required in glia for axon debris clearance, encoding members of the Atg8a (LC3) conjugation system and the Vps34 lipid kinase complex including UVRAG and Rubicon. Phagosomal Rubicon and Atg16 WD40 domain-dependent conjugation of Atg8a mediate proper breakdown of internalized axon fragments, and Rubicon overexpression in glia accelerates debris elimination. Finally, LAP promotes survival following traumatic brain injury. Our results reveal a role of glial LAP in the clearance of neuronal debris in vivo, with potential implications for the recovery of the injured nervous system.