While there is a growing appreciation of three-dimensional (3D) neural tissues (i.e., hydrogel-based, organoids, and spheroids), shown to improve cellular health and network activity to mirror brain-like activity in vivo, functional assessment using current electrophysiology techniques (e.g., planar multi-electrode arrays or patch clamp) has been technically challenging and limited to surface measurements at the bottom or top of the 3D tissue. As next-generation MEAs, specifically 3D MEAs, are being developed to increase the spatial precision across all three dimensions (X, Y, Z), development of improved computational analytical tools to discern region-specific changes within the Z dimension of the 3D tissue is needed. In the present study, we introduce a novel computational analytical pipeline to analyze 3D neural network activity recorded from a “bottom-up” 3D MEA integrated with a 3D hydrogel-based tissue containing human iPSC-derived neurons and primary astrocytes. Over a period of ~6.5 weeks, we describe the development and maturation of 3D neural activity (i.e., features of spiking and bursting activity) within cross sections of the 3D tissue, based on the vertical position of the electrode on the 3D MEA probe, in addition to network activity (identified using synchrony analysis) within and between cross sections. Then, using the sequential addition of postsynaptic receptor antagonists, bicuculline (BIC), 2-amino-5-phosphonovaleric acid (AP-5), and 6-cyano-5-nitroquinoxaline-2,3-dione (CNQX), we demonstrate that networks within and between cross sections of the 3D hydrogel-based tissue show a preference for GABA and/or glutamate synaptic transmission, suggesting differences in the network composition throughout the neural tissue. The ability to monitor the functional dynamics of the entire 3D reconstructed neural tissue is a critical bottleneck; here we demonstrate a computational pipeline that can be implemented in studies to better interpret network activity within an engineered 3D neural tissue and have a better understanding of the modeled organ tissue.