The accuracy with which listeners can locate sounds is much greater than the spatial sensitivity of single neurons(1-3). The broad spatial tuning of auditory neurons indicates that a code based on the responses of ensembles of neurons, a population code, must be used to determine the position of a sound in space, Here we show that the tuning of neurons to the most potent localization cue, the interaural time difference in low-frequency signals (< similar to 2 kHz; refs 4, 5), becomes sharper as the information ascends through the auditory system, We also show that this sharper tuning increases the efficiency of the population code, in the sense that fewer neurons are required to achieve a given acuity.