Functional magnetic resonance imaging (fMRI) was used to examine how the brain responds to temporal compression of speech and to determine whether the same regions are also involved in phonological processes associated with reading. Recorded speech was temporally compressed to varying degrees and presented in a sentence verification task. Regions involved in phonological processing were identified in a separate scan using a rhyming judgment task with pseudowords compared to a lettercase judgment task. The left inferior frontal and left superior temporal regions (Broca's and Wernicke's areas), along with the right inferior frontal cortex, demonstrated a convex response to speech compression; their activity increased as compression increased, but then decreased when speech became incomprehensible. Other regions exhibited linear increases in activity as compression increased, including the middle frontal gyri bilaterally. The auditory cortices exhibited compression-related decreases bilaterally, primarily reflecting a decrease in activity when speech became incomprehensible. Rhyme judgments engaged two left inferior frontal gyrus regions (pars triangularis and pars opercularis), of which only the pars triangularis region exhibited significant compression-related activity. These results directly demonstrate that a subset of the left inferior frontal regions involved in phonological processing is also sensitive to transient acoustic features within the range of comprehensible speech.