Powassan virus (POWV) is an emerging tick-borne Flavivirus that causes lethal encephalitis and long-term neurologic damage. Currently, there are no POWV therapeutics, licensed vaccines, or reverse genetics systems for producing infectious POWVs from recombinant DNA. Using a circular polymerase extension reaction (CPER), we generated recombinant LI9 (recLI9) POWVs with attenuating NS1 protein mutations and a recLI9-split-eGFP reporter virus. NS1 proteins are highly conserved glycoproteins that regulate replication, spread, and neurovirulence. POWV NS1 contains three putative N-linked glycosylation sites that we modified individually in infectious recLI9 mutants (N85Q, N208Q, and N224Q). NS1 glycosylation site mutations reduced replication kinetics and were attenuated, with 1-2 log decreases in titer. Severely attenuated recLI9-N224Q exhibited a 2- to 3-day delay in focal cell-to-cell spread and reduced NS1 secretion but was lethal when intracranially inoculated into suckling mice. However, footpad inoculation of recLI9-N224Q resulted in the survival of 80% of mice and demonstrated that NS1-N224Q mutations reduce POWV neuroinvasion in vivo. To monitor NS1 trafficking, we CPER fused a split GFP11-tag to the NS1 C-terminus and generated an infectious reporter virus, recLI9-NS1-GFP11. Cells infected with recLI9-NS1-GFP11 revealed NS1 trafficking in live cells and the novel formation of large NS1-lined intracellular vesicles. An infectious recLI9-NS1-GFP11 reporter virus permits real-time analysis of NS1 functions in POWV replication, assembly, and secretion and provides a platform for evaluating antiviral compounds. Collectively, our robust POWV reverse genetics system permits analysis of viral spread and neurovirulence determinants in vitro and in vivo and enables the rational genetic design of live attenuated POWV vaccines. IMPORTANCE Our findings newly establish a mechanism for genetically modifying Powassan viruses (POWVs), systematically defining pathogenic determinants and rationally designing live attenuated POWV vaccines. This initial study demonstrates that mutating POWV NS1 glycosylation sites attenuates POWV spread and neurovirulence in vitro and in vivo. Our findings validate a robust circular polymerase extension reaction approach as a mechanism for developing, and evaluating, attenuated genetically modified POWVs. We further designed an infectious GFP-tagged reporter POWV that permits us to monitor secretory trafficking of POWV in live cells, which can be applied to screen potential POWV replication inhibitors. This robust system for modifying POWVs provides the ability to define attenuating POWV mutations and create genetically attenuated recPOWV vaccines.