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The basolateral membrane of the mammalian inner hair cell (IHC) expresses large voltage and Ca2+ gated outward K+ currents. To quantify how the voltage-dependent activation of the K+ channels affects the functionality of the auditory nerve innervating the IHC, this study adopts a model of mechanical-to-neural transduction in which the basolateral K+ conductances of the IHC can be made voltage-dependent or not. The model shows that the voltage-dependent activation of the K+ channels (i) enhances the phase-locking properties of the auditory fiber (AF) responses; (ii) enables the auditory nerve to encode a large dynamic range of sound levels; (iii) enables the AF responses to synchronize precisely with the envelope of amplitude modulated stimuli; and (iv), is responsible for the steep offset responses of the AFs. These results suggest that the basolateral K+ channels play a major role in determining the well-known response properties of the AFs and challenge the classical view that describes the IHC membrane as an electrical low-pass filter. In contrast to previous models of the IHC-AF complex, this study ascribes many of the AF response properties to fairly basic mechanisms in the IHC membrane rather than to complex mechanisms in the synapse.We studied the effects of the IHC basolateral K+ currents in a model.Basolateral K+ channels are fundamental for auditory nerve phase-locking.Basolateral K+ channels allow for steep offset responses of the auditory neurons.Differences between neural adaptation and recovery originate in the IHC membrane.The functional role of the IHC membrane is not just that of a low-pass filter.