The effects of six-channel compression and expansion amplification on the intelligibility of nonsense syllables embedded in speech spectrum noise were examined for four hearing-impaired subjects. For one condition (linear) the stimulus was given six-channel amplification with frequency shaping to suit the subject's hearing loss. The other condition (nonlinear) was the same except that low level inputs, to any given channel, received expansion amplification and high level inputs received compression. For each condition, each subject received the nonsense syllables at three different input levels, representing low, average, and high intensity speech. The results of this study, like those of most other studies of multichannel compression, are mainly negative. Nonlinear processing (mainly expansion) of low intensity speech resulted in a significant degradation of speech intelligibility for two subjects and in no improvement for the others. One subject showed a significant improvement in intelligibility for the nonlinearly processed average intensity speech and another subject showed significant improvement for the high intensity input (mainly compression). Clearly, nonlinear processing is beneficial for some subjects, under some listening conditions, but further research is needed to identify the relevent characteristics of such subjects. An acoustic analysis of selected items revealed that the failure of expansion to improve intelligibility was primarily due to the very low intensity consonants /e/ and /k/, in final position, being presented at an even lower intensity in the expansion condition than in the linear condition. Expansion may be worth further investigation with different parameters. Several other problems caused by the multichannel processing were also revealed. These included alteration of spectral shapes and band interaction effects. Ways of overcoming these problems, and of capitalizing on the likely advantages of multichannel amplification, are currently being investigated.