A portable sound processor has been developed to facilitate research on advanced hearing aids. Because it is based on a digital signal processing integrated circuit (Motorola DSP56001), it can readily be programmed to execute novel algorithms. Furthermore, the parameters of these algorithms can be adjusted quickly and easily to suit the specific hearing characteristics of users. In the processor, microphone signals are digitized to a precision of 12 bits at a sampling rate of approximately 12 kHz for input to the DSP device. Subsequently, processed samples are delivered to the earphone by a novel, fully-digital class-D driver. This driver provides the advantages of a conventional class-D amplifier (high maximum output, low power consumption, low distortion) without some of the disadvantages (such as the need for precise analog circuitry). In addition, a cochlear implant driver is provided so that the processor is suitable for hearing-impaired people who use an implant and an acoustic hearing aid together. To reduce the computational demands on the DSP device, and therefore the power consumption, a running spectral analysis of incoming signals is provided by a custom-designed switched-capacitor integrated circuit incorporating 20 bandpass filters. The complete processor is pocket-sized and powered by batteries. An example is described of its use in providing frequency-shaped amplification for aid users with severe hearing impairment. Speech perception tests confirmed that the processor performed significantly better than the subjects' own hearing aids, probably because the digital filter provided a frequency response generally closer to the optimum for each user than the simpler analog aids.