Toxic dipeptide-repeat (DPR) proteins are produced from expanded G4C2 repeats in the C9ORF72 gene, the most common genetic cause of amyotrophic lateral sclerosis (ALS) and frontotemporal dementia (FTD). Two DPR proteins, poly-PR and poly-GR, repress cellular translation but the molecular mechanism remains unknown. Here we show that poly-PR and poly-GR of ≥20 repeats inhibit the ribosome's peptidyl-transferase activity at nanomolar concentrations, comparable to specific translation inhibitors. High-resolution cryogenic electron microscopy (cryo-EM) reveals that poly-PR and poly-GR block the polypeptide tunnel of the ribosome, extending into the peptidyl-transferase center (PTC). Consistent with these findings, the macrolide erythromycin, which binds in the tunnel, competes with poly-PR and restores peptidyl-transferase activity. Our results demonstrate that strong and specific binding of poly-PR and poly-GR in the ribosomal tunnel blocks translation, revealing the structural basis of their toxicity in C9ORF72-ALS/FTD.