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alpha-Calcitonin gene-related peptide (alphaCGRP) is one of several neurotransmitters immunolocalized in the unmyelinated component of the cochlear efferent innervation, the lateral olivocochlear (OC) system, which makes axo-dendritic synapses with cochlear sensory neurons. In rodents, CGRP is also immunocolocalized in the myelinated medial OC system, which contacts cochlear outer hair cells (OHCs). To understand the role(s) of this neuropeptide in the OC system, we characterized the auditory phenotype of alphaCGRP-null mice. Cochlear threshold sensitivity was normal in mutant mice, both via a neural metric, the auditory brain stem response (ABR), and an OHC-based metric, distortion product otoacoustic emissions (DPOAEs). Medial OC function and resistance to acoustic injury were also unaffected by alphaCGRP deletion: the former was assessed by measuring cochlear response suppression with electrical stimulation of the OC bundle, the latter by measuring temporary threshold shifts after exposure to high level sound. However, significant abnormality in alphaCGRP-null mice was seen in the growth of cochlear neural responses with increasing stimulus level. This observation, contrasted with normal amplitude-versus-level functions for DPOAEs, is consistent with a selective, postsynaptic effect on cochlear neurons via alphaCGRP release from lateral OC terminals. This constitutes the most direct evidence to date for a functional role of the lateral OC system in the auditory periphery.