We investigated amplitude-modulated (AM) tone encoding behavior of dorsal and posteroventral cochlear-nucleus (DCN and PVCN) neurons and auditory nerve (AN) fibers in decerebrate unanesthetized cats. Some of the modulation transfer functions (MTFs) were narrowly-tuned band-pass functions; these included responses at moderate and high stimulus levels of DCN pause/build-type-III neurons and the following types of DCN and PVCN chopper neurons: chop-S and/or chop-type-I/III. Other MTFs were broad low-pass or complex functions. Chop-T neurons of the DCN and PVCN tended to exhibit low-pass or flat MTFs. The band-pass MTF neurons exhibited intrinsic oscillations (IOs) in responses to AM or pure tones. The IOs, which were detected in autocorrelation functions and power spectra, were closely correlated (r = 0.863) with the best envelope frequency (BEF). All of the AN fibers showed broad low-pass MTFs with some showing a rudimentary peak in the MTF. The MTFs of DCN-PVCN neurons and AN fibers showed, respectively: (1) BEFs ranging 50–500 Hz, and 400–1300 Hz; (2) upper cut-off frequencies ranging 200–1200 Hz, and 1600–3200 Hz. At stimulus levels of 60–85 dB SPL, maximum modulation gains were as high as 12 dB for DCN-PVCN neurons but were limited to below about 0 dB for AN fibers. The median dynamic ranges of DCN and PVCN neurons (51 and 42 dB, respectively) were substantially wider than those of the low and high spontaneous rate AN fibers (30 and 31 dB, respectively). The observation of higher modulation gain, wider dynamic range, and more narrowly-tuned MTF of DCN-PVCN neurons than AN fibers supports the concept that the capabilities to encode dynamic signals are enhanced in DCN-PVCN neurons compared with AN fibers.