Astrocytes are essential for the formation and maintenance of neural networks. However, a major technical challenge for investigating astrocyte function and disease-related pathophysiology has been the limited ability to obtain functional human astrocytes. Despite recent advances in human pluripotent stem cell (hPSC) techniques, primary rodent astrocytes remain the gold standard in coculture with human neurons. We demonstrate that a combination of leukemia inhibitory factor (LIF) and bone morphogenetic protein-4 (BMP4) directs hPSC-derived neural precursor cells to a highly pure population of astroglia in 28 d. Using single-cell RNA sequencing, we confirm the astroglial identity of these cells and highlight profound transcriptional adaptations in cocultured hPSC-derived astrocytes and neurons, consistent with their further maturation. In coculture with human neurons, multielectrode array recordings revealed robust network activity of human neurons in a coculture with hPSC-derived or rat astrocytes [3.63 ± 0.44 min-1 (hPSC-derived), 2.86 ± 0.64 min-1 (rat); p = 0.19]. In comparison, we found increased spike frequency within network bursts of human neurons cocultured with hPSC-derived astrocytes [56.31 ± 8.56 Hz (hPSC-derived), 24.77 ± 4.04 Hz (rat); p < 0.01], and whole-cell patch-clamp recordings revealed an increase of postsynaptic currents [2.76 ± 0.39 Hz (hPSC-derived), 1.07 ± 0.14 Hz (rat); p < 0.001], consistent with a corresponding increase in synapse density [14.90 ± 1.27/100 μm2 (hPSC-derived), 8.39 ± 0.63/100 μm2 (rat); p < 0.001]. Taken together, we show that hPSC-derived astrocytes compare favorably with rat astrocytes in supporting human neural network activity and maturation, providing a fully human platform for investigating astrocyte function and neuronal-glial interactions.