We predict and demonstrate that a disorder-induced carrier density inhomogeneity causes magnetoresistance (MR) in a two-dimensional electron system. Our experiments on graphene show a quadratic MR persisting far from the charge neutrality point. Effective medium calculations show that for charged impurity disorder, the low-field MR is a universal function of the ratio of carrier density to fluctuations in carrier density, a power law when this ratio is large, in excellent agreement with experiment. The MR is generic and should occur in other materials with large carrier density inhomogeneity.