In vivo voltage clamp recordings have provided new insights into the synaptic mechanisms that underlie processing in the primary auditory cortex. Of particular importance are the discoveries that excitatory and inhibitory inputs have similar frequency and intensity tuning, that excitation is followed by inhibition with a short delay, and that the duration of inhibition is briefer than expected. These findings challenge existing models of auditory processing in which broadly tuned lateral inhibition is used to limit excitatory receptive fields and suggest new mechanisms by which inhibition and short term plasticity shape neural responses.