In the newest implementation of cochlear implant surgery, electrode arrays of 10 or 20mm are inserted into the cochlea with the aim of preserving hearing in the region apical to the tip of the electrode array. In the current study two measures were used to assess hearing preservation: changes in audiometric threshold and changes in psychophysical estimates of nonlinear cochlear processing. Nonlinear cochlear processing was evaluated at signal frequencies of 250 and 500Hz using Schroeder phase maskers with various indices of masker phase curvature. A total of 15 normal-hearing listeners and 13 cochlear implant patients (7 with a 10mm insertion and 6 with a 20mm insertion) were tested. Following surgery the mean low-frequency threshold elevation was 12.7dB (125–750Hz). Nine patients had postimplant thresholds within 5–10dB of preimplant thresholds. Only one patient, however, demonstrated a completely normal nonlinear cochlear function following surgery—although most retained some degree of residual nonlinear processing. This result indicates (i) that Schroeder phase masking functions are a more sensitive index of surgical trauma than audiometric threshold and (ii) that preservation of a normal cochlear function in the apex of the cochlea is relatively uncommon but possible.