An apparatus and a method for reducing a time division multiple access noise of a portable terminal. The apparatus includes an interface unit to which an earphone is electrically connected, an audio processing unit including a virtual ground for transmitting and receiving an audio signal through the interface unit, a switch unit located electrically between the interface unit and the audio processing unit for electrically connecting a ground terminal of the interface unit with one of a real ground and the virtual ground of the audio processing unit, and a controller for controlling the switch unit to electrically connect the ground terminal of the interface unit with the virtual ground of the audio processing unit when a call function using the earphone is activated, and to electrically connect the ground terminal of the interface unit with the real ground when the call function using the earphone is deactivated.