Thanks to the ease of controlling digital inputs and outputs, an Arduino or compatible board works well with digital audio hardware that has a MIDI interface. In this example by Instructables member Christhian180 an Arduino programmed with various sound data can be controlled with a MIDI instrumnet - in this case a keyboard, and used to make all sorts of sound or effects.
For sound output a simple amplifier circuit based on the classic LM386 is constructed which takes the output from one of the Arduino's PWM outputs and boosts it for use with an external speaker. It's a lot of fun, and a quick demonstration is given in the following video:
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