A new method is presented for the purpose of improving pass/fail separation during transient evoked otoacoustic emission (TEOAE) hearing screening. The method combines signal decomposition in scales using the discrete wavelet transform, non-linear denoising and scale-dependent time windowing. The cross-correlation coefficient between two subaveraged, processed TEOAE signals is used as a pass/fail criterion and assessed in relation to the pure-tone, mean hearing level. The performance is presented in terms of receiver operating characteristics for a database of 5,214 individuals. The results show that the specificity improves from 68% to 83% at a sensitivity of 90% when compared with the conventional wave reproducibility parameter.