Although human cytomegalovirus (HCMV) is a known cause of sensorineural hearing loss in infants with congenital HCMV (cCMV) infections, mechanisms that contribute to sensorineural hearing loss (SNHL) in infants with cCMV infection are not well defined. Using a murine model of CMV infection during auditory development, we have shown that peripheral infection of newborn mice with murine CMV (MCMV) results in focal infection of the cochlea and virus-induced cochlear inflammation. Approximately 50%-60% of infected mice exhibited increased auditory brainstem response (ABR) thresholds across a range of sound frequencies. Histological analyses of the cochlea in MCMV-infected mice with elevated ABR thresholds revealed preservation of hair cell (HC) number and morphology in the organ of Corti. In contrast, the number of spiral ganglion neurons (SGN), synapses, and neurites connecting the cochlear HC and SGN nerve terminals were decreased. Decreasing cochlear inflammation by corticosteroid treatment of MCMV-infected mice resulted in preservation of SGN and improved auditory function. These findings show that virus-induced cochlear inflammation during early auditory development, rather than direct virus-mediated damage, could contribute to histopathology in the cochlea and altered auditory function without significant loss of HCs in the sensory epithelium.