Intensity defines one fundamental aspect of sensory information and is specifically represented in each sensory modality. Interestingly, only in the central auditory system are intensity-selective neurons evolved. These neurons are characterized by nonmonotonic response-level functions. The synaptic circuitry mechanisms underlying the generation of intensity selectivity from nonselective auditory nerve inputs remain largely unclear. Here, we performed in vivo whole-cell recordings from pyramidal neurons in the rat dorsal cochlear nucleus (DCN), where intensity selectivity first emerges along the auditory neuraxis. Our results revealed that intensity-selective cells received fast-saturating excitation but slow-saturating inhibition with intensity increments, whereas in intensity-nonselective cells excitation and inhibition were similarly slow-saturating. The differential intensity tuning profiles of the monotonic excitation and inhibition qualitatively determined the intensity selectivity of output responses. In addition, the selectivity was further strengthened by significantly lower excitation/inhibition ratios at high-intensity levels compared with intensity-nonselective neurons. Our results demonstrate that intensity selectivity in the DCN is generated by extracting the difference between tuning profiles of nonselective excitatory and inhibitory inputs, which we propose can be achieved through a differential circuit mediated by feedforward inhibition.