An earphone arrangement comprises a microphone (109) which generates a microphone signal and a sound transducer (101) which radiates a first sound component to a user's ear (103) in response to a drive signal. An acoustic channel (111) is further provided for channeling external sound so as to provide a second sound component to the user's ear (103). An acoustic valve (117) allows the attenuation of the acoustic channel (111) to be controlled in response to a valve control signal. A control circuit (105) generates the valve control signal in response to the microphone signal to provide a variable attenuation resulting in a mixed sound of the first sound component and the second sound component reaching the user's ear (103). The combined use of acoustic and e.g. electric signal paths allows improved performance and in particular allows a dynamic trade-off between open and closed earphone design characteristics with respect to external sounds.