Telomere shortening is one hallmark of cell ageing that can limit the proliferative capacity of cell populations and increase risk for age-related disease. It has been hypothesized that short telomeres, and subsequently a limited proliferative capacity of hippocampal progenitor cells, could contribute to smaller hippocampal volumes and impaired cognition, amongst psychiatric disorder patients. The current study employed a systematic, multidisciplinary approach which aimed to model the effects of telomere shortening on human hippocampal neurogenesis, and to explore its relationship with cognition and psychiatric disorder risk. We modelled telomere shortening in human hippocampal progenitor cells in vitro using a serial passaging protocol that mimics the end-replication problem. Aged progenitors demonstrated shorter telomeres (p<0.05), and reduced rates of cell proliferation, as marked by bromodeoxyuridine staining (p<0.001), with no changes in the ability of cells to differentiate into neurons or glia. RNAsequencing and gene set enrichment analysis revealed an effect of cell ageing on gene networks related to neurogenesis, telomere maintenance, cell senescence and cytokine production. Downregulated transcripts showed a significant overlap with genes regulating cognitive function and risk for schizophrenia and bipolar disorder. Collectively, our results suggest that reductions in adult hippocampal neurogenesis, caused by telomere shortening, could represent a cellular mechanism contributing to age-related cognitive impairment and psychiatric disorder risk.