White matter diffusion anisotropy in the acoustic radiations of the auditory pathway was characterized as a function of development in children and adolescents. Auditory-evoked neuromagnetic fields were also recorded from the same individuals, and the latency of the left and right superior temporal gyrus auditory response of approximately 100 ms was also obtained. White matter diffusion anisotropy increased with age. There was a commensurate shortening of the auditory-evoked response latency with increased age as well as with increased white matter diffusion anisotropy. The significant negative correlation between structural integrity of white matter pathways and electrophysiological function (response timing) of distal cortex supports a biophysical model of developmental changes in white matter myelination, conduction velocity, and cortical response timing.