This modeling study examines the possible functional roles of two hyperpolarization-activated conductances in lateral superior olive (LSO) principal neurons. Inputs of these LSO neurons are transformed into an output, which provides a firing-rate code for a certain interaural sound intensity difference (IID) range. Recent experimental studies have found pharmacological evidence for the presence of both the Gh conductance as well as the inwardly rectifying outward GKIR conductance in the LSO. We addressed the question of how these conductances influence the dynamic range (IID versus firing rate). We used computer simulations of both a point-neuron model and a two-compartmental model to investigate this issue, and to determine the role of these conductances in setting the dynamic range of these neurons. The width of the dynamic regime, the frequency-current (f-I) function, first-spike latency, subthreshold oscillations and the interplay between the two hyperpolarization activated conductances are discussed in detail. The in vivo non-monotonic IID-firing rate function in a subpopulation of LSO neurons is in good correspondence with our simulation predictions. Two compartmental model simulation results suggest segregation of Gh and GKIR conductances on different compartments, as this spatial configuration could explain certain experimental results.