Amyotrophic lateral sclerosis (ALS) is a fatal neurodegenerative disease of the motor nervous system. We show using multielectrode array and patch-clamp recordings that hyperexcitability detected by clinical neurophysiological studies of ALS patients is recapitulated in induced pluripotent stem cell-derived motor neurons from ALS patients harboring superoxide dismutase 1 (SOD1), C9orf72, and fused-in-sarcoma mutations. Motor neurons produced from a genetically corrected but otherwise isogenic SOD1^+/+ stem cell line do not display the hyperexcitability phenotype. SOD1^A4V/+ ALS patient-derived motor neurons have reduced delayed-rectifier potassium current amplitudes relative to control-derived motor neurons, a deficit that may underlie their hyperexcitability. The Kv7 channel activator retigabine both blocks the hyperexcitability and improves motor neuron survival in vitro when tested in SOD1 mutant ALS cases. Therefore, electrophysiological characterization of human stem cell-derived neurons can reveal disease-related mechanisms and identify therapeutic candidates.