Genetic factors contributing to hearing loss (HL) are heterogeneous, and effective medical treatments remain limited. We identified three distinct missense variants in CPD, encoding carboxypeptidase D, in five individuals with congenital deafness from three unrelated families, affecting the catalytically active CP-domain2 of this protein. Subsequent analysis of a larger cohort from the 100,000 Genomes Project (100KGP), revealed an enrichment of rare protein-altering CPD variants in individuals with HL. We show that CPD localizes to sensory epithelium and nerve cells in the mouse cochlea, and the enzymatic activity of CPD, crucial for nitric oxide (NO) production through arginine processing, is impaired in affected individuals. The levels of arginine, NO, and cyclic guanosine monophosphate (cGMP) in patient-derived fibroblasts are also decreased, leading to increased oxidative stress and cell death via endoplasmic reticulum stress-mediated mechanisms. Silencing of Cpd in organotypic mouse cochlea cultures leads to increased apoptosis. Finally, Drosophila models of CPD deficiency display defective Johnston's organ, impaired auditory transduction, and sensory and movement abnormalities. Notably, these phenotypes are partially rescued by the supplementation with arginine or sildenafil, a cGMP enhancer. Our findings establish CPD mutations as a cause of congenital HL, highlighting that the NO signaling pathway offers a promising therapeutic avenue.