Internal auditory canal (IAC) stenosis with hypoplasia of the facial and vestibulocochlear nerves is a rare cause of congenital facial palsy. In this case report, a 3-month-old female infant was referred for a neurological developmental assessment for developmental delay and congenital facial palsy. Upon evaluation of developmental delay, hearing loss was detected. Following a magnetic resonance imaging scan of the brain and a computed tomography scan of the temporal bone, IAC stenosis with hypoplasia of facial and vestibular nerves was diagnosed. This is a rare case of IAC stenosis in an infant with initial presentations of left facial palsy and developmental delay associated with hearing loss in the left ear. We strongly suggest that IAC stenosis be considered a cause of congenital facial palsy in infants, especially in patients with developmental delay. In infants with congenital facial palsy, a thorough physical examination and neurological developmental assessment should be performed.