Efforts to study the development and function of the human cerebral cortex in health and disease have been limited by the availability of model systems. Extrapolating from our understanding of rodent cortical development, we have developed a robust, multistep process for human cortical development from pluripotent stem cells: directed differentiation of human embryonic stem (ES) and induced pluripotent stem (iPS) cells to cortical stem and progenitor cells, followed by an extended period of cortical neurogenesis, neuronal terminal differentiation to acquire mature electrophysiological properties, and functional excitatory synaptic network formation. We found that induction of cortical neuroepithelial stem cells from human ES cells and human iPS cells was dependent on retinoid signaling. Furthermore, human ES cell and iPS cell differentiation to cerebral cortex recapitulated in vivo development to generate all classes of cortical projection neurons in a fixed temporal order. This system enables functional studies of human cerebral cortex development and the generation of individual-specific cortical networks ex vivo for disease modeling and therapeutic purposes.