Schizophrenia (SZ) is a neurodevelopmental genetic disorder in which maternal immune activation (MIA) and increased tumor necrosis factor-α (TNF-α) may contribute. Previous studies using iPSC-derived cerebral organoids and neuronal cells demonstrated developmental malformation and transcriptional dysregulations, including TNF receptors and their signaling genes, common to SZ patients with diverse genetic backgrounds. In the present study, we examined the significance of the common TNF receptor dysregulations by transiently exposing cerebral organoids from embryonic stem cells (ESC) and from representative control and SZ patient iPSCs to TNF. In control iPSC organoids, TNF produced malformations qualitatively similar in, but generally less pronounced than, the malformations of the SZ iPSC-derived organoids. TNF and SZ alone disrupted subcortical rosettes and dispersed proliferating Ki67 + neural progenitor cells (NPC) from the organoid ventricular zone (VZ) into the cortical zone (CZ). In the CZ, the absence of large ramified pan-Neu + neurons coincided with loss of myelinated neurites despite increased cortical accumulation of O4 + oligodendrocytes. The number of calretinin + interneurons increased; however, they lacked the preferential parallel orientation to the organoid surface. SZ and SZ+TNF affected fine cortical and subcortical organoid structure by replacing cells with extracellular matrix (ECM)-like fibers The SZ condition increased developmental vulnerability to TNF,