The cochlea provides a biological information-processing paradigm that we are only beginning to understand in its full complexity. Our work reveals an interacting network of strongly nonlinear dynamical nodes, on which even a simple sound input triggers subnetworks of activated elements that follow power-law size statistics (“avalanches”). From dynamical systems theory, power-law size distributions relate to a fundamental ground state of biological information processing. Learning destroys these power laws. These results strongly modify the models of mammalian sound processing and provide a novel methodological perspective for understanding how the brain processes information.