Homeostasis is indispensable to counteract the destabilizing effects of Hebbian plasticity. Although it is commonly assumed that homeostasis modulates synaptic strength, membrane excitability, and firing rates, its role at the neural circuit and network level is unknown. Here, we identify changes in higher-order network properties of freely behaving rodents during prolonged visual deprivation. Strikingly, our data reveal that functional pairwise correlations and their structure are subject to homeostatic regulation. Using a computational model, we demonstrate that the interplay of different plasticity and homeostatic mechanisms can capture the initial drop and delayed recovery of firing rates and correlations observed experimentally. Moreover, our model indicates that synaptic scaling is crucial for the recovery of correlations and network structure, while intrinsic plasticity is essential for the rebound of firing rates, suggesting that synaptic scaling and intrinsic plasticity can serve distinct functions in homeostatically regulating network dynamics.