Complex regional pain syndrome (CRPS) is often associated with reduced sound tolerance (hyperacusis) on the affected side, but the mechanism of this symptom is unclear. As compensatory increases in central auditory activity after cochlear injury may trigger hyperacusis, hearing and discomfort thresholds to pure tones (250, 500, 1000, 2000, 3000, 4000, 6000, and 8000 Hz) were assessed in 34 patients with CRPS and 26 pain-free controls. In addition, in 31 patients and 17 controls, auditory-evoked potentials to click stimuli (0.08 ms duration, 6 Hz, 60 dB above the hearing threshold) were averaged across 2000 trials for each ear. Auditory discomfort thresholds were lower at several pitches on the CRPS-affected than contralateral side and lower at all pitches on the affected side than in controls. However, ipsilateral hyperacusis was not associated with psychophysical or physiological signs of cochlear damage. Instead, neural activity in the ipsilateral brainstem and midbrain was greater when repetitive click stimuli were presented on the affected than contralateral side and greater bilaterally than in controls. In addition, click-evoked potentials, reflecting thalamo-cortical signal transfer and early cortical processing, were greater contralaterally in patients than controls. Together, these findings suggest that hyperacusis originates in the ipsilateral brainstem and midbrain rather than the peripheral auditory apparatus of patients with CRPS. Failure of processes that jointly modulate afferent auditory signalling and pain (eg, inhibitory influences stemming from the locus coeruleus) could contribute to ipsilateral hyperacusis in CRPS.