Phoneme detection and identification tasks, and their more recent hybrids, have been the primary tools used to explore whether and how lexical memory influences earlier perceptual processes, with differences between words and pseudowords suggestive of such influences. Processing differences between words and pseudowords are also found in the Verbal Transformation Effect, which is a perceptual phenomenon in which continuous, rapid repetition of a word causes listeners to hear the word transform into other utterances. In this talk, the nature of this lexical effect will be described and two mechanisms responsible for verbal transformations will be discussed. The results tie in with recent work exploring lexical feedback and suggest that the influences of lexical memory extend to perceptual processes beyond those involved in phoneme perception.