Psychotic episodes are debilitating disease states that can cause extreme distress and impair functioning. There are sex differences that drive the onset of these episodes. One difference is that, in addition to a risk period in adolescence and early adulthood, women approaching the menopause transition experience a second period of risk for new-onset psychosis. One leading hypothesis explaining this menopause-associated psychosis (MAP) is that estrogen decline in menopause removes a protective factor against processes that contribute to psychotic symptoms. However, the neural mechanisms connecting estrogen decline to these symptoms are still not well understood. Using the tools of computational psychiatry, links have been proposed between symptom presentation and potential algorithmic and biological correlates. These models connect changes in signaling with symptom formation by evaluating changes in information processing that are not easily observable (latent states). In this manuscript, we contextualize the observed effects of estrogen (decline) on neural pathways implicated in psychosis. We then propose how estrogen could drive changes in latent states giving rise to cognitive and psychotic symptoms associated with psychosis. Using computational frameworks to inform research in MAP may provide a systematic method for identifying patient-specific pathways driving symptoms and simultaneously refine models describing the pathogenesis of psychosis across all age groups.