Human brain development is under tight molecular genetic control and the recent advent of single-cell genomics has revolutionized our ability to elucidate the diverse underlying cell-types and states. Although RNA splicing is highly prevalent in the brain and has strong links to neuropsychiatric disorders, previous work has not systematically investigated the role of cell-type-specific splicing or transcript-isoform diversity during human brain development. Here, we leverage single molecule long-read sequencing to deeply profile the full-length transcriptome of the germinal zone (GZ) and cortical plate (CP) regions of the developing human neocortex at tissue and single-cell resolution. We identify 214,516 unique isoforms, corresponding to 22,391 genes. Remarkably, we find that 72.6% of these are novel and together with >7,000 novel-spliced exons expands the proteome by 92,422 proteoforms. We uncover myriad novel isoform switches during cortical neurogenesis, implicating previously-uncharacterized RNA-binding protein-mediated and other regulatory mechanisms in cellular identity and disease. Early-stage excitatory neurons exhibit the greatest isoform diversity and isoform-based single-cell clustering identifies previously uncharacterized cell states. Leveraging this resource, we re-prioritize thousands of rare de novo risk variants associated with neurodevelopmental disorders (NDDs) and reveal that risk genes are strongly associated with the number of unique isoforms observed per gene. Altogether, this work uncovers a substantial contribution of transcript-isoform diversity in cellular identity in the developing neocortex, elucidates novel genetic risk mechanisms for neurodevelopmental and neuropsychiatric disorders, and provides a comprehensive isoform-centric gene annotation for the developing human brain.