It is well known that failure to treat severe congenital hypothyroidism leads to profound auditory disability, and it has been suggested that an intracochlear defect, or defects, associated with the condition diminishes the efficacy of an active, physiologically vulnerable nonlinear transduction process commonly referred to as cochlear amplification. We address this question directly by tracking the development of threshold-frequency (tuning) curves and two-tone suppression in hypothyroid, Tshr mutant mice born to hypothyroid dams and comparing those findings with findings observed in euthyroid mice. Like sharp tuning, two-tone suppression is a product of transduction nonlinearity and is a useful indicator of the functional status of cochlear amplification. In contrast to euthyroid mice that acquire sharp tuning, normal two-tone suppression, and adultlike sensitivity by the end of the third postnatal week, as shown in earlier studies, hypothyroid mice remained grossly insensitive to sound throughout life. In addition, tuning was generally broad in hypothyroid mice, tuning curve "tips" were frequently missing, and two-tone suppression was rarely observed. However, unlike tip thresholds, tuning curve "tail" thresholds, a feature that reflects the functional status of passive elements of transduction, acquired normal values over a roughly 2-month postnatal time period. These observations collectively suggest that active transduction micromechanics, at least in the frequency region studied here, are profoundly affected by thyroid hormone and support speculation that abnormal outer hair cell function may be the cause of the primary, enduring peripheral auditory defect associated with profound, congenital hypothyroidism in the Tshr mutant mouse.