Mosaic loss of chromosome Y (LOY) in leukocytes has been associated with many diseases, yet it remains unclear whether this form of clonal mosaicism exerts a direct physiological effect. Here we perform single-cell and bulk RNA sequencing in leukocytes, observing considerable variation in the rate of LOY across individuals, cell types and disease state. Cells with LOY demonstrated a profound degree of transcriptional dysregulation, impacting ~500 autosomal genes. These genes are preferentially involved in immune functions but also encode proteins with roles in other diverse biological processes. Our findings highlight a surprisingly broad role for chromosome Y, challenging the view of it as a “genetic wasteland”. Furthermore, they support the hypothesis that altered immune function in leukocytes is a mechanism directly linking LOY to disease.