Inclusion Criteria:

* Reasonable exclusion of tumor or malignancy before baseline visit (randomization)
* Onset of autoimmune encephalitis (AIE) symptoms \<=9 months before randomization
* Meet the definition of "New Onset" or "Incomplete Responder" AIE
* For women of childbearing potential: agreement to remain abstinent (refrain from heterosexual intercourse) or use adequate contraception during the treatment period and for at least 3 months after the final dose of satralizumab or placebo
* For participants enrolled in the extended China enrollment phase at National Medical Products Administration (NMPA)-recognized sites: participants who are current residents of mainland China, Hong Kong, or Taiwan, and of Chinese ancestry

N-methyl-D-aspartic acid receptor (NMDAR) AIE Cohort

* Age \>=12 years
* Diagnosis of probable or definite NMDAR encephalitis

Leucine-rich glioma-inactivated 1 (LGI1) AIE Cohort

* Age \>=18 years
* Diagnosis of LGI1 encephalitis

Exclusion Criteria:

* Any untreated teratoma or thymoma at baseline visit (randomization)
* History of carcinoma or malignancy, unless deemed cured by adequate treatment with no evidence of recurrence for \>=5 years before screening
* For patients with NMDAR AIE, history of negative anti-NMDAR antibody in cerebrospinal fluid (CSF) using a cell-based assay within 9 months of symptom onset
* Historically known positivity to an intracellular antigen with high cancer association or GAD-65
* Historically known positivity to any cell surface neuronal antibodies other than NMDAR and LGI1
* Confirmed paraneoplastic encephalitis
* Confirmed central or peripheral nervous system demyelinating disease
* Alternative causes of associated symptoms
* History of herpes simplex virus encephalitis in the previous 24 weeks
* Any previous/concurrent treatment with IL-6 inhibitory therapy (e.g., tocilizumab), alemtuzumab, total body irradiation, or bone marrow transplantation
* Any previous treatment with anti-CD19 antibody, complement inhibitors, neonatal Fc receptor antagonists, anti-B-lymphocyte stimulator monoclonal antibody
* Any previous treatment with T-cell depleting therapies, cladribine, or mitoxantrone
* Treatment with oral cyclophosphamide within 1 year prior to baseline Treatment with any investigational drug (including bortezomib) within 24 weeks prior to screening
* Concurrent use of more than one IST as background therapy
* Contraindication to all of the following rescue treatments: rituximab, IVIG, high-dose corticosteroids, or intravenous (IV) cyclophosphamide
* Any surgical procedure, except laparoscopic surgery or minor surgeries within 4 weeks prior to baseline, excluding surgery for thymoma or teratoma removal
* Planned surgical procedure during the study
* Evidence of progressive multifocal leukoencephalopathy
* Evidence of serious uncontrolled concomitant diseases that may preclude patient participation
* Congenital or acquired immunodeficiency, including HIV infection
* Active or presence of recurrent bacterial, viral, fungal, mycobacterial infection, or other infection
* Infection requiring hospitalization or treatment with IV anti-infective agents within 4 weeks prior to baseline visit
* Positive hepatitis B (HBV) and hepatitis C (HCV) test at screening
* Evidence of latent or active tuberculosis (TB)
* History of drug or alcohol abuse within 1 year prior to baseline
* History of diverticulitis or concurrent severe gastrointestinal (GI) disorders that, in the investigator's opinion, may lead to increased risk of complications such as GI perforation
* Receipt of live or live-attenuated vaccine within 6 weeks prior to baseline visit
* History of blood donation (1 unit or more), plasma donation or platelet donation within 90 days prior to screening
* History of severe allergic reaction to a biologic agent
* Active suicidal ideation within 6 months prior to screening, or history of suicide attempt within 3 years prior to screening
* Any serious medical condition or abnormality in clinical laboratory tests that, in the investigator's judgment, precludes safe participation in and completion of the study
* Pregnant or breastfeeding, or intending to become pregnant during the study or within 3 months after the final dose of study drug
* Laboratory abnormalities at Screening

Note: Other protocol defined Inclusion/Exclusion Criteria may apply.

Eligibility last updated 4/24/2024. Questions regarding updates should be directed to the study team contact.