People who stutter (PWS) can reduce their stuttering rates under masking noise and altered auditory feedback; such a response can be attributed to altered auditory input, which suggests that abnormal speech processing in PWS results from abnormal processing of auditory input. However, the details of this abnormal processing of basic auditory information remain unclear. In order to characterize such abnormalities, we examined the functional and structural changes in the auditory cortices of PWS by using a 306-channel magnetoencephalography system to assess auditory sensory gating (P50m suppression) and tonotopic organization. Additionally, we employed voxel-based morphometry to compare cortical gray matter (GM) volumes on structural MR images. PWS exhibited impaired left auditory sensory gating. The tonotopic organization in the right hemisphere of PWS is expanded compared with that of the controls. Furthermore, PWS showed a significant increase in the GM volume of the right superior temporal gyrus, consistent with the right tonotopic expansion. Accordingly, we suggest that PWS have impaired left auditory sensory gating during basic auditory input processing and that some error signals in the auditory cortex could result in abnormal speech processing. Functional and structural reorganization of the right auditory cortex appears to be a compensatory mechanism for impaired left auditory cortex function in PWS.