Seizures are a prominent feature in N-Methyl-D-Aspartate receptor antibody (NMDAR antibody) encephalitis, a distinct neuro-immunological disorder in which specific human autoantibodies bind and crosslink the surface of NMDAR proteins thereby causing internalization and a state of NMDAR hypofunction. To further understand ictogenesis in this disorder, and to test a potential treatment compound, we developed an NMDAR antibody mediated rat seizure model that displays spontaneous epileptiform activity in vivo and in vitro. Using a combination of electrophysiological and dynamic causal modelling techniques we show that, contrary to expectation, reduction of synaptic excitatory, but not inhibitory, neurotransmission underlies the ictal events through alterations in the dynamical behaviour of microcircuits in brain tissue. Moreover, in vitro application of a neurosteroid, pregnenolone sulphate, that upregulates NMDARs, reduced established ictal activity. This proof-of-concept study highlights the complexity of circuit disturbances that may lead to seizures and the potential use of receptor-specific treatments in antibody-mediated seizures and epilepsy.