The retinal degenerative diseases, which together constitute a leading cause of hereditary blindness worldwide, are largely untreatable. Development of reliable methods to culture complex retinal tissues from human pluripotent stem cells (hPSCs) could offer a means to study human retinal development, provide a platform to investigate the mechanisms of retinal degeneration and screen for neuroprotective compounds, and provide the basis for cell-based therapeutic strategies. In this study, we describe an in vitro method by which hPSCs can be differentiated into 3D retinas with at least some important features reminiscent of a mature retina, including exuberant outgrowth of outer segment-like structures and synaptic ribbons, photoreceptor neurotransmitter expression, and membrane conductances and synaptic vesicle release properties consistent with possible photoreceptor synaptic function. The advanced outer segment-like structures reported here support the notion that 3D retina cups could serve as a model for studying mature photoreceptor development and allow for more robust modeling of retinal degenerative disease in vitro.