Developing in vivo functional and structural neuroimaging assays in Dyt1 ΔGAG heterozygous knock-in (Dyt1 KI) mice provide insight into the pathophysiology underlying DYT1 dystonia. In the current study, we examined in vivo functional connectivity of large-scale cortical and subcortical networks in Dyt1 KI mice and wild-type (WT) controls using resting-state functional magnetic resonance imaging (MRI) and an independent component analysis. In addition, using diffusion MRI we examined how structural integrity across the basal ganglia and cerebellum directly relates to impairments in functional connectivity. Compared to WT mice, Dyt1 KI mice revealed increased functional connectivity across the striatum, thalamus, and somatosensory cortex; and reduced functional connectivity in the motor and cerebellar cortices. Further, Dyt1 KI mice demonstrated elevated free-water (FW) in the striatum and cerebellum compared to WT mice, and increased FW was correlated with impairments in functional connectivity across basal ganglia, cerebellum, and sensorimotor cortex. The current study provides the first in vivo MRI-based evidence in support of the hypothesis that the deletion of a 3-base pair (ΔGAG) sequence in the Dyt1 gene encoding torsinA has network level effects on in vivo functional connectivity and microstructural integrity across the sensorimotor cortex, basal ganglia, and cerebellum.