Auditory verbal hallucinations are a common phenomenon in the general population, with many people without psychological issues reporting the experience. In the ‘White Christmas’ method to induce auditory hallucinations, participants are told that they will be played a portion of the song ‘White Christmas’ and are asked to report when they hear it. Participants are presented only with stochastic noise; still, a large proportion of participants report hearing the song. The experiments reported here investigate how masking relationships modulate verbal hallucinations in the White-Christmas effect. Specifically, we tested how the effect is modulated by different kinds of maskers (multi-talker babble versus spectrally matched speech-shaped stochastic noise) and different kinds of expectation of the speech being masked (expecting a ‘normal’ modal voice versus a whispered voice behind the masking). The White Christmas effect was replicated, and the rate of verbal hallucinations was higher for multi-talker babble than for spectrally-matched speech-shaped stochastic noise. In addition, a trend for a higher rate of hallucination for whispered voices was found. These results confirm the role of masking relations in the White Christmas effect and reinforce the similarity between the White Christmas effect and continuity illusions such as phoneme restoration.