While neurodevelopmental abnormalities have been associated with schizophrenia (SCZ), the role of astroglia in disease pathophysiology remains poorly understood. In this study we used a human induced pluripotent stem cell (iPSC)-derived astrocyte model to investigate the temporal patterns of astroglia differentiation during developmental stages critical for SCZ using RNA-sequencing. The model generated astrocyte-specific patterns of gene expression during differentiation, and demonstrated that these patterns correspond well to astroglia-specific expression signatures of in vivo cortical fetal development. Applying this model, we were able to identify SCZ-specific expression dynamics in human astrocytes, and found that SCZ-associated differentially expressed genes were significantly enriched in the medial prefrontal cortex, striatum, and temporal lobe, targeting VWA5A and ADAMTS19. In addition, SCZ astrocytes displayed alterations in calcium signaling, and significantly decreased glutamate uptake and metalloproteinase activity relative to controls. These results provide strong support for the validity of our astrocyte model, and implicate novel transcriptional dynamics in astrocyte differentiation in SCZ together with functional changes that are potentially important biological components of SCZ pathology.