A model for the generation and distribution of electrical potentials within the guinea pig cochlea was simulated by computer. Electrical impedances of the cochlear tissues and biological batteries in the stria vascularis and organ of Corti were modelled by a three‐dimensional network of resistors and batteries. It was assumed that cochlear‐partition movements caused electrical‐impedance changes in hair cells and resulted in modulation of steady‐state electrical currents normally flowing throughout the cochlea. The model response to a 1000‐Hz tone demonstrated that the amplitude envelope for the electrical current through the hair cells had the same shape as the mechanical traveling‐wave envelope, whereas the envelopes for the potential changes within cochlear scalae were broader and had their peaks nearer the basal end of the cochlea. Potentials generated by the model accurately reflected the amplitude and phase of the cochlear‐partition displacement only from the base to within about 3 mm of the peak of the traveling‐wave envelope. An important finding was that, when the impedance of a hair cell was decreased, current from adjacent hair cells was shunted through it, thus providing a possible excitation‐inhibition mechanism for neural sharpening.