Mac Mini volume control disabled when using thunderbolt for display

HDMI, DisplayPort and Thunderbolt carry a fixed volume digital audio signal so the external device controls the volume. In the future Apple may implement HDMI-CEC which would allow your computer to control the external device volume via software, similarly some devices have drivers which allow them to do the same.

In the meantime, here's a workaround:

• Install SoundFlower
• Download SoundFlowerBed, copy to /Applications and run.
• SoundFlowerBed menu item -> under SoundFlower (2ch) set output to HDMI.
• System Preferences -> Sound -> select SoundFlower (2ch) as Output device.
• System Preferences -> Users & Groups -> Login Items -> Add SoundFlowerBed.

Now you have two volume controls: HDMI display volume control and via software on your mac. With this setup your mac is digitally resampling the output and so Mac 100% volume + display 50% volume will likely sound better than Mac 50% volume + display 100% volume.