Our perception of sound at any point in time is dependent not only on the sound itself, but also on the acoustic environment of the recent past. These auditory context effects reflect the adaptation of the auditory system to the ambient conditions, and provide the potential for improving coding efficiency as well as providing the basis for some forms of perceptual invariance in the face of different talkers, different room environments, and different types of background noise. Despite their obvious importance for auditory perception, the mechanisms underlying auditory context effects remain unclear. The overall goal of this thesis was to investigate different auditory context effects in both normal-hearing listeners and cochlear-implant (CI) users, to shed light on the potential underlying mechanisms, to reveal their implications for auditory perception, and to investigate the effects of hearing loss on these context effects. In Chapters 2, 3 and 4, different context effects, known respectively as the loudness context effect (LCE), induced loudness reduction (ILR), and spectral motion contrast effect, are examined. Another context effect, known as auditory enhancement, is introduced in Chapter 5 with a vowel enhancement paradigm, and is further explored in Chapter 6 by treating it as process of frequency-selective gain control. Finally, a simplified neural model is proposed in Chapter 7 to explain the basis of auditory enhancement, while remaining consistent with the results from the studies of other context effects. The results reveal both similarities and differences between normal-hearing listeners and CI users in responses to auditory context effects, and suggest a role of peripheral processes played in auditory context effects and a potential opportunity to improve current CI speech processing strategies through a restoration of normal auditory context effects.