Influenza viral infections often lead to increased mortality in older people. However, the mechanisms by which aging impacts immunity to influenza lung infection remain unclear. We employed a murine model of influenza infection to identify these mechanisms. With aging, we found reduced numbers of alveolar macrophages, cells essential for lung homeostasis. We also determined that these macrophages are critical for influenza-induced mortality with aging. Furthermore, aging vastly alters the transcriptional profile and specifically downregulates cell cycling pathways in alveolar macrophages. Aging impairs the ability of alveolar macrophages to limit lung damage during influenza infection. Moreover, aging decreases alveolar macrophage phagocytosis of apoptotic neutrophils, downregulates the scavenging receptor CD204, and induces retention of neutrophils during influenza infection. Thus, aging induces defective phagocytosis by alveolar macrophages and increases lung damage. These findings indicate that therapies that enhance the function of alveolar macrophages may improve outcomes in older people infected with respiratory viruses.