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Simple Summary: Induced pluripotent stem cells (iPSCs) are crucial for disease modeling and cell-based therapy because they serve as an infinite source of specific human cell types. The use of iPSCs in cancer immunotherapy and cell transplantation therapy has garnered much attention in personalized medicine. To improve the efficacy and specificity of brain cancer treatment, iPSCs can be used to derive human brain tumor models for therapeutic evaluation. This review summarizes the utilization of human iPSCs to generate brain-specific cells, organoids, and tumor models for brain cancer modeling and drug testing. In addition, current challenges, limitations, and future prospects to find a more efficacious approach for treating human brain cancers are discussed. Brain cancer is a group of diverse and rapidly growing malignancies that originate in the central nervous system (CNS) and have a poor prognosis. The complexity of brain structure and function makes brain cancer modeling extremely difficult, limiting pathological studies and therapeutic developments. Advancements in human pluripotent stem cell technology have opened a window of opportunity for brain cancer modeling, providing a wealth of customizable methods to simulate the disease in vitro. This is achieved with the advent of genome editing and genetic engineering technologies that can simulate germline and somatic mutations found in human brain tumors. This review investigates induced pluripotent stem cell (iPSC)-based approaches to model human brain cancer. The applications of iPSCs as renewable sources of individual brain cell types, brain organoids, blood–brain barrier (BBB), and brain tumor models are discussed. The brain tumor models reviewed are glioblastoma and medulloblastoma. The iPSC-derived isogenic cells and three-dimensional (3D) brain cancer organoids combined with patient-derived xenografts will enhance future compound screening and drug development for these deadly human brain cancers. [ABSTRACT FROM AUTHOR]