A new, well-preserved specimen of Troodon formosus is the first to reveal the internal anatomy of the lower part of the braincase. In addition to providing new information on the brain of this highly encephalized dinosaur, the uncrushed bones clear up anatomical details left obscure by earlier studies. Computerized tomography (CT) scans reveal the nature of the inner ear and the course of the pneumatic ducts diverging from the middle ear. Evidence is presented to show that four of the five periotic pneumatic systems found in bird skulls are present in Troodon. The anterior tympanic recess is the most elaborate system, and diverticula from each side extend anteriorly, dorsally and, posteriorly from the middle ear. The posterior tympanic recess is located within the paroccipital process and the basioccipital, but the pneumatopore posterolateral to the stapedial recess is secondarily closed. The dorsal periotic sinus is represented by a smooth-surfaced concavity on the lateral surface of the prootic. The position of a pneumatic recess in this region is demonstrated by the presence of a pneumatopore in the quadrate. Diverticula from the anterior and posterior tympanic recesses are connected within braincase bones, and a possible pneumatopore in the prootic may connect these to the dorsal tympanic recess. The pneumatic condition of the troodontid articular is unknown. Contralateral connections of the sinus systems have been used to argue for a close relationship between birds and crocodiles, but their presence in this specimen suggests that they appeared more than once in archosaurs or that they are plesiomorphic for crocodiles, dinosaurs, and birds. Cranial pneumaticity cannot be used by itself to resolve the interrelationships of crocodiles, theropods, and birds, but other characters suggest derivation of birds from theropods.