How We Hear - Video 

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So now we know: To have a normal hearing the whole sound sensing system must work properly.
The outer ear gathers and funnels the sound into middle ear.
In the middle ear sound  moves the eardrum, respectively the three little bones  that  sends vibrations to inner ear.
Inside the cochlea (the tiny organ in the inner ear), liquid moves the hair cells that translates vibrations into electrical impulses that are further transmitted to the brain.
At the very end the brain "translates" those impulses into perception of sound.

If a part of the outer, middle, or inner ear is damaged  or in a deteriorating state, a person can develop hearing loss.