Responses of single auditory‐nerve fibers of normal and kanamycin‐treated Mongolian gerbils indicate that inputs from inner and outer hair cells tend to cancel each other at frequencies below the characteristic frequency (CF). In normal animals, trapezoidal motion of the basilar membrane produces velocity and displacement responses which change systematically with CF. In kanamycin‐treated animals, two types of abnormal responses nearly 180° out of phase with respect to each other are found. Latencies of these responses and anatomical changes generally produced by kanamycin indicate that one type is produced predominantly by the inner, the other predominantly by the outer hair cells. Normal firing patterns can be reconstructed from these two kinds of responses. They appear to result from an excitatory input from the inner hair cells and an inhibitory input from the outer hair cells. This interpretation is consistent with the generally found hair‐cell directionality. The inferred interaction between the inner and outer hair cells points out a solution to the problem of neural sharpening of mechanical frequency analysis in the cochlea.