While Mullin, Ampex and Crosby were inaugurating the era of audiotape in 1948, Peter Goldmark, the same scientist who was developing CBS' color TV system, invented the 33-rpm long-playing vinyl record. The new disc had much longer playing time and much higher fidelity than the 78-rpm wax discs that were then the norm. To play the new vinyl recordings, General Electric introduced a sapphire-tipped phono cartridge, which replaced the heavier, mostly steel or osmium needles.

The following year, RCA introduced the 45-rpm vinyl disc, the seven-inch "single" that would become the primary method for disseminating rock-and-roll music. Also in 1949, Magnecord introduced the first stereo tape recorder/player for consumers.

Despite the appearance of vinyl records, most early hi-fi recordings were limited to reel-to-reel tape. London Records brought practical high-fidelity stereo to vinyl records in 1958, but even then not all recordings were released in stereo. For instance, even the first Beatles records in the mid-1960s, although recorded in stereo, were released in mono on their initial vinyl releases.

Hackers, hobbyists and other assorted engineers began to cobble together amplifiers and stereo speakers to play back these new high fidelity recordings at home. Throughout the late 1940s and 1950s, small companies founded by such entrepreneurs as Avery Fisher, Jim Lansing, Sidney Harman, Hermon Scott, Henry Kloss, Amar Bose, Paul Klipsch and Saul Marantz sprang up to manufacture hi-fi equipment.

Some of the developments in this period include the first high-fidelity speaker; Klipsch's corner horned speaker in 1946; and Kloss' acoustic-suspension speaker. In 1956, the first transistorized amplifier came from Fisher Electronics, developed in a factory on the site now occupied by the Lincoln Center symphonic hall that bears the company founder's name; the first audio receiver, developed by Harman-Kardon; and, for private listening, the first commercial stereo headphones from John Koss in 1958.

Meanwhile, the hundreds of retailers in Radio Row in downtown Manhattan that had been selling amateur radio gear now began to sell hi-fi equipment, and new stores selling the new stereo and TV gear such as Harvey and Lafayette opened. Similar audiophile stores began popping up in Chicago, Boston and Philadelphia and along Melrose Avenue in Los Angeles, as well as a growing national chain, Radio Shack. In New York City in 1947, A.J. Richard took over his father's hardware store business and turned it into a 49-store consumer electronics chain during the next 50 years. And in Fort Worth, Texas, in 1963, Charles Tandy bought a struggling nine-store chain of electronics hobbyist shops called RadioShack.

In 1961, Zenith research scientist Carl Eilers brought hi-fi stereo to FM. The first transistorized radio tuners, amplifiers and receivers also made their debuts during this fertile development period. And in the late 1960s, Len Feldman and Jon Fixler developed quadraphonic four-channel sound.

By the late 1960s, the hi-fi and television business had grown so much that Jack Wayman, an Electronic Industries Association senior vice-president, determined that a specialized consumer electronics trade show was necessary. The first International Consumer Electronics Show (CES) was held in New York, then the center of the TV and hi-fi business, in 1967.

In 1963, Philips Electronics N.V. developed the audiocassette, which made listening to tape much easier, thanks in part to a new noise reduction technology that removed background tape hiss. Ray Dolby, who, while just starting college had helped invent video recording more than a decade earlier, developed this noise reduction scheme in 1967. It was around this time that a former used car mogul, Earl "Mad Man" Muntz introduced the four-track endless-loop tape, and then bought the rights to and popularized William Lear's eight-track audiocassette format, which had first appeared in Ford cars in 1965. During the mid-1960s, the first transportable "boombox" and all-in-one "compact" stereo products began to appear from companies such as Concord and Sanyo, both led by Howard Ladd, who bought Fisher and combined it with Sanyo in 1975.

The audiocassette always had seemed a poor cousin to the vinyl LP – until the cassette player left the house. Cassette decks first made it into cars and, eventually, pockets with the introduction of the Sony Walkman in 1979, completely changing the way America commuted. Instead of a communal experience, music now was a matter of personal choice. The individuality the Walkman brought to music-listening contributed to the era being dubbed the "me" generation.

By 1983, the audiocassette had usurped the vinyl record as the leading format for pre-recorded music, according to the Recording Industry Association of America (RIAA), and would stay that way for nearly a decade.

In Japan, a struggling drummer named Daisuke Inoue found another use for the audio cassette. Customers at lounges at which his singerless band performed often requested songs to which they could get up and sing along. One group of fans asked if he could provide tapes of his music so they could sing along with them on an upcoming vacation. Instead, Inoue jury-rigged a red-and-white painted wooden box with a microphone, an amplifier and an 8-track tape machine built-in that played a sing-along song when a 100-yen coin was dropped into it. His band recorded instrumental tracks and his new company, Crecent, leased his "8-Juke" – soon dubbed karaoke, or "empty orchestra" in Japanese – to bars and hotels.

The karaoke fad swept Japan and by the mid-1970s almost every bar in the Far East had a karaoke machine. Unfortunately, Inoue had failed to patent his machine, and by 1987 competition from large companies producing bigger and better machines forced his small company out of business. But the popularity of karaoke prompted Time magazine to name Inoue one of Asia's most influential people (along with Mohandas Gandhi and Mao Zedong). In 2004, he was awarded an Ig Nobel Peace Prize for "providing an entirely new way for people to learn to tolerate each other".

Surveys indicated that soon every American had at least three audiocassette players – one in the home, one in the car and one portable. But soon, even the audiocassette would be overtaken by a new audio playback technology.