Thyroid hormones (THs) are essential for brain development, and their dysregulation is associated with cognitive deficits and neurodevelopmental disorders. Down syndrome (DS), caused by trisomy 21, is frequently associated with thyroid dysfunction and impaired neurogenesis. Here, we investigated THs signaling dynamics during neural differentiation using human induced pluripotent stem cells (hiPSCs) derived from individuals with DS and controls. We analyzed the gene expression of key THs regulators—deiodinases, transporters, and receptors—and downstream target genes in hiPSCs, hiPSC-derived neural progenitor cells (NPCs), hiPSC-derived astrocytes, and hiPSC-derived neurons. DS-derived hiPSCs, hiPSC-derived NPCs, and hiPSC-derived neurons exhibited 2- to 7-fold increases in the gene expression of DIO2 and 3- to 8-fold reductions in DIO3, alongside 1- to 3-fold downregulation of THRA and THRB isoforms. hiPSC-derived astrocytes showed a 4-fold decrease in the gene expression of DIO2, a 4-fold increase in DIO3, upregulation of SLC16A10 (2-fold), and downregulation of SLC7A5 (0.5-fold) and THs receptors (0.5- to 12-fold). hiPSC-derived neurons exhibited marked downregulation of the gene expression of HOMER1 (0.5-fold), GRIN3A (14-fold), and GRIN3B (4-fold), accompanied by impaired spontaneous activity in multi-electrode array recordings. These findings reveal a robust, cell-type-specific imbalance between THs availability and signaling competence in DS hiPSC-derived neural cells, providing mechanistic insight into THs-related contributions to the function of DS hiPSC-derived neural cells and identifying potential therapeutic targets.