We describe a novel, truncated transcript of ZNF804A, ZNF804AE3E4. Unlike the full-length transcript, ZNF804AE3E4 is regulated in human fetal brain by the genome-wide psychosis risk allele rs1344706. This finding suggests that ZNF804AE3E4 may be a critical isoform mediating the association and draws attention to the importance of alternative transcripts, and the fetal period, in the processes by which genetic variation affects neurodevelopmental psychiatric disorders. The fact that ZNF804A is translated into protein is also significant, increasing the likelihood that the gene has functional and pathophysiological roles in the brain. Equally, our data highlight the complexities involved when trying to identify the biological basis of a genetic association with a psychiatric disorder.