The mammalian lateral geniculate nucleus (LGN) is known to regulate signal transfer from the retina to the brain neocortex in a highly complex manner. Besides inputs from the brainstem, extraretinal inputs via corticogeniculate projections and local inhibitory neurons modulate signal transfer in the LGN. However, very little is known about whether the postnatal development of LGN signal-transfer mechanisms is influenced by early discordant binocular vision. By intraunit comparisons of responses between individual X-LGN cells and their direct retinal inputs, the efficiency of signal transfer was found permanently reduced due to an early interocular misalignment (strabismus). The contrast sensitivity and spatial resolution of cat LGN cells were significantly lower relative to their retinal inputs, and there was substantial decrease in signal-transfer speed. The observed physiological deficits were associated with immature X-retinogeniculate axon arbors. Thus, contrary to previous ideas, conflicting binocular inputs can produce neural deficits in subcortical visual structures.