Human microglia, as innate immune cells of the central nervous system (CNS), play a central role in the pathogenesis of a large number of neurological and psychiatric disorders. However, experimental access to primary human microglia for biomedical applications such as disease modeling is extremely limited. While induced pluripotent stem cells (iPSCs) could provide an alternative source of microglia, the reenactment of their complex ontogenesis with a yolk sac origin and subsequent priming upon CNS invasion has remained a challenge. Here, we report a developmentally informed in vitro differentiation method for large-scale production and cryopreservation of iPSC-derived microglia (iPSdMiG). Specifically, iPSCs were propagated in conditions yielding both yolk sac hematopoietic derivatives and early neuroepithelial cells. To enable large-scale production, we implemented 3D bioreactor-based dynamic culture conditions and the use of novel mesh macrocarriers. Under these conditions, microglia could be harvested across a time period of at least 6 weeks, with 1 × 10 iPSCs giving rise to up to 45 × 10 iPSdMiG. The transcriptomic profile of iPSdMiG showed high similarity to adult human microglia, and harvested cells were immunopositive for typical microglial markers. In addition, iPSdMiG were able to secrete pro-inflammatory cytokines, engaged in phagocytotic activity, produced reactive oxygen species and lent themselves to co-culture studies in neural 2D and 3D systems. Importantly, iPSdMiG were efficiently cryopreserved, enabling the establishment of donor-specific microglia cell banks for disease modeling, drug discovery and eventually cell therapy. Main points. Scalable generation of iPSC-derived multi-lineage embryoid bodies on macrocarriers, reproducibly releasing microglia exhibiting characteristic markers and function. Cells are transcriptomically similar to primary human microglia and cryopreservable.