Mutations in the thyroid hormone receptor α 1 gene (THRA) have recently been identified as a cause of intellectual deficit in humans. Patients present with structural abnormalities including microencephaly, reduced cerebellar volume and decreased axonal density. Here, we show that directed differentiation of THRA mutant patient-derived induced pluripotent stem cells to forebrain neural progenitors is markedly reduced, but mutant progenitor cells can generate deep and upper cortical layer neurons and form functional neuronal networks. Quantitative lineage tracing shows that THRA mutation-containing progenitor cells exit the cell cycle prematurely, resulting in reduced clonal output. Using a micropatterned chip assay, we find that spatial self-organization of mutation-containing progenitor cells in vitro is impaired, consistent with down-regulated expression of cell-cell adhesion genes. These results reveal that thyroid hormone receptor α1 is required for normal neural progenitor cell proliferation in human cerebral cortical development. They also exemplify quantitative approaches for studying neurodevelopmental disorders using patient-derived cells in vitro.