Hearing loss has a negative effect on the daily life of 10-15% of the world’s population. One of the most common ways to treat a hearing loss is to fit hearing aids which increases audibility by providing amplification. Hearing aids thus improve speech reception in quiet, but listening in noise is nevertheless often difficult and stressful. Individual differences in cognitive capacity have been shown to be linked to differences in speech recognition performance in noise. An individual’s cognitive capacity is limited and is gradually consumed by increasing demands when listening in noise. Thus, fewer cognitive resources are left to interpret and process the information conveyed by the speech. Listening effort can therefore be explained by the amount of cognitive resources occupied with speech recognition. A well fitted hearing aid improves speech reception and leads to less listening effort, therefore an objective measure of listening effort would be a useful tool in the hearing aid fitting process. In this thesis the Auditory Inference Span Test (AIST) was developed to assess listening effort by measuring an individual’s cognitive spare capacity, the remaining cognitive resources available to interpret and encode linguistic content of incoming speech input while speech understanding takes place. The AIST is a dual-task hearing-innoise test, combining auditory and memory processing, and requires executive processing of speech at different memory load levels. The AIST was administered to young adults with normal hearing and older adults with hearing impairment. The aims were 1) to develop the AIST; 2) to investigate how different signal-to-noise ratios (SNRs) affect memory performance for perceived speech; 3) to explore if this performance would interact with cognitive capacity; 4) to test if different background noise types would interact differently with memory performance for young adults with normal hearing; and 5) to examine if these relationships would generalize to older adults with hearing impairment. The AIST is a new test of cognitive spare capacity which uses existing speech material that is available in several countries, and manipulates simultaneously cognitive load and SNR. Thus, the design of AIST pinpoints potential interactions between auditory and cognitive factors. The main finding of this thesis was the interaction between noise type and SNR showing that decreased SNR reduced cognitive spare capacity more in speech-like noise compared to speech-shaped noise, even though speech intelligibility levels were similar between noise types. This finding applied to young adults with normal hearing but there was a similar effect for older adults with hearing impairment with the addition of background noise compared to no background noise. Task demands, MLLs, interacted with cognitive capacity, thus, individuals with less cognitive capacity were more sensitive to increased cognitive load. However, MLLs did not interact with noise type or with SNR, which shows that different memory load levels were not affe...