X-linked Dystonia-Parkinsonism (XDP) is a Mendelian neurodegenerative disease that is endemic to the Philippines and is associated with a founder haplotype. We integrated multiple genome and transcriptome assembly technologies to narrow the causal mutation to the TAF1 locus, which included a SINE-VNTR-Alu (SVA) retrotransposition into intron 32 of the gene. Transcriptome analyses identified decreased expression of the canonical cTAF1 transcript among XDP probands, and de novo assembly across multiple pluripotent stem-cell-derived neuronal lineages discovered aberrant TAF1 transcription that involved alternative splicing and intron retention (IR) in proximity to the SVA that was anti-correlated with overall TAF1 expression. CRISPR/Cas9 excision of the SVA rescued this XDP-specific transcriptional signature and normalized TAF1 expression in probands. These data suggest an SVA-mediated aberrant transcriptional mechanism associated with XDP and may provide a roadmap for layered technologies and integrated assembly-based analyses for other unsolved Mendelian disorders.