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Human cerebral malaria (HCM), a severe encephalopathy associated with Plasmodium falciparum infection, has a 20–30% mortality rate and predominantly affects African children. The mechanisms mediating HCM-associated brain injury are difficult to study in human subjects, highlighting the urgent need for non-invasive ex vivo human models. HCM elevates the systemic levels of free heme, which damages the blood-brain barrier and neurons in distinct regions of the brain. We determined the effects of heme on induced pluripotent stem cells (iPSCs) and a three-dimensional cortical organoid system and assessed apoptosis and differentiation. We evaluated biomarkers associated with heme-induced brain injury, including a pro-inflammatory chemokine, CXCL-10, and its receptor, CXCR3, brain-derived neurotrophic factor (BDNF) and a receptor tyrosine-protein kinase, ERBB4, in the organoids. We then tested the neuroprotective effect of neuregulin-1 (NRG-1) against heme treatment in organoids. Neural stem and mature cells differentially expressed CXCL-10, CXCR3, BDNF and ERBB4 in the developing organoids and in response to heme-induced neuronal injury. The organoids underwent apoptosis and structural changes that were attenuated by NRG-1. Thus, cortical organoids can be used to model heme-induced cortical brain injury associated with HCM pathogenesis as well as for testing agents that reduce brain injury and neurological sequelae.