Localized cell and drug delivery to the cochlea and central auditory pathway can improve the safety and performance of implanted auditory prostheses (APs). While generally successful, these devices have a number of limitations and adverse effects including limited tonal and dynamic ranges, channel interactions, unwanted stimulation of non-auditory nerves, immune rejection, and infections including meningitis. Many of these limitations are associated with the tissue reactions to implanted auditory prosthetic devices and the gradual degeneration of the auditory system following deafness. Strategies to reduce the insertion trauma, degeneration of target neurons, fibrous and bony tissue encapsulation, and immune activation can improve the viability of tissue required for AP function as well as improve the resolution of stimulation for reduced channel interaction and improved place-pitch and level discrimination. Many pharmaceutical compounds have been identified that promote the viability of auditory tissue and prevent inflammation and infection. Cell delivery and gene therapy have provided promising results for treating hearing loss and reversing degeneration. Currently, many clinical and experimental methods can produce extremely localized and sustained drug delivery to address AP limitations. These methods provide better control over drug concentrations while eliminating the adverse effects of systemic delivery. Many of these drug delivery techniques can be integrated into modern auditory prosthetic devices to optimize the tissue response to the implanted device and reduce the risk of infection or rejection. Together, these methods and pharmaceutical agents can be used to optimize the tissue-device interface for improved AP safety and effectiveness.