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Although numerous studies have investigated the effects of single-microphone digital noise-reduction algorithms for adults with hearing loss, similar studies have not been conducted with young hearing-impaired children. The goal of this study was to examine the effects of a commonly used digital noise-reduction scheme (spectral subtraction) in children with mild to moderately severe sensorineural hearing losses. It was hypothesized that the process of spectral subtraction may alter or degrade speech signals in some way. Such degradation may have little influence on the perception of speech by hearing-impaired adults who are likely to use contextual information under such circumstances. For young children who are still developing various language skills, however, signal degradation may have a more detrimental effect on the perception of speech.Sixteen children (eight 5- to 7-yr-olds and eight 8- to 10-yr-olds) with mild to moderately severe hearing loss participated in this study. All participants wore binaural behind the ear hearing aids where noise-reduction processing was performed independently in 16 bands with center frequencies spaced 500 Hz apart up to 7500 Hz. Test stimuli were nonsense syllables, words, and sentences in a background of noise. For all stimuli, data were obtained with noise reduction (NR) on and off conditions.In general, performance improved as a function of speech to noise ratio for all three speech materials. The main effect for stimulus type was significant and post hoc comparisons of stimulus type indicated that speech recognition was higher for sentences than that for both nonsense syllables and words, but no significant differences were observed between nonsense syllables and words. The main effect for NR and the two-way interaction between NR and stimulus type were not significant. Significant age group effects were observed, but the two-way interaction between NR and age group was not significant.Consistent with previous findings from studies with adults, results suggest that the form of NR used in this study does not have a negative effect on the overall perception of nonsense syllables, words, or sentences across the age range (5 to 10 yrs) and speech to noise ratios (0, +5, and +10 dB) tested.