To define the role of rare variants in advanced age-related macular degeneration (AMD) risk, we sequenced the exons of 681 genes within all reported AMD loci and related pathways in 2,493 cases and controls. We first tested each gene for increased or decreased burden of rare variants in cases compared to controls. We found that 7.8% of AMD cases compared to 2.3% of controls are carriers of rare missense CFI variants (odds ratio (OR) = 3.6; P = 2 × 10 -8). There was a predominance of dysfunctional variants in cases compared to controls. We then tested individual variants for association with disease. We observed significant association with rare missense alleles in genes other than CFI. Genotyping in 5,115 independent samples confirmed associations with AMD of an allele in C3 encoding p.Lys155Gln (replication P = 3.5 × 10 -5, OR = 2.8; joint P = 5.2 × 10 -9, OR = 3.8) and an allele in C9 encoding p.Pro167Ser (replication P = 2.4 × 10 -5, OR = 2.2; joint P = 6.5 × 10 -7, OR = 2.2). Finally, we show that the allele of C3 encoding Gln155 results in resistance to proteolytic inactivation by CFH and CFI. These results implicate loss of C3 protein regulation and excessive alternative complement activation in AMD pathogenesis, thus informing both the direction of effect and mechanistic underpinnings of this disorder.