Efferent feedback systems provide a means for modulating the input to the central nervous system. The lateral olivocochlear efferents modulate auditory nerve activity via synapses with afferent dendrites below sensory inner hair cells. We examined the effects of dopamine, one of the lateral olivocochlear neurotransmitters, by recording compound and single unit activity from the auditory nerve in adult guinea pigs. Intracochlear application of dopamine reduced the compound action potential (CAP) of the auditory nerve, increased the thresholds and decreased the spontaneous and driven discharge rates of the single unit fibres without changing their frequency-tuning properties. Surprisingly, dopamine antagonists SCH-23390 and eticlopride decreased CAP amplitude as did dopamine. In some units, both SCH-23390 and eticlopride increased the basal activity of auditory nerve fibres leading to an improvement of threshold sensitivity and a decrease of the maximum driven discharge rates to sound. In other units, the increase in firing rate was immediately followed by a marked reduction to values below predrug rates. Because CAP reflects the summed activity of auditory nerve fibres discharging in synchrony, both the decrease in sound-driven discharge rate and the postexcitatory reduction account for the reduction in CAP. Ultrastructural examination of the cochleas perfused with eticlopride showed that some of the afferent dendrites were swollen, suggesting that the marked reduction in firing rate may reflect early signs of excitotoxicity. Results suggest that dopamine may exert a tonic inhibition of the auditory nerve activity. Removal of this tonic inhibition results in the development of early signs of excitotoxicity.