The present work tested two competing hypotheses about how the location of sounds in space is encoded by auditory cortex. The labelled-line hypothesis says that each azimuthal location is encoded by maximal firing of a specific small and sharply tuned population of neurons. The two-channel hypothesis says that a sound location is encoded by the relative activity of two populations of neurons with broad tuning and maximal activity at ± 90. To test these hypotheses a new behavioural task was developed in which subjects had to report the location of a target sound relative to a preceding reference. Models of the two-channel hypothesis and a modified version of the labelled-line hypothesis that accounted for better sound localisation precision at the midline, predicted best performance in the task around the midline with performance decreasing in the periphery whereas the labelled-line hypothesis predicted equal performance throughout space. Consistent with both the two-channel and modified labelled-line model, both ferret and human performance was best at the midline, highlighting the need for neural recordings in auditory cortex to distinguish between these models. The peaks of spatial receptive fields of neurons recorded from auditory cortex of ferrets performing the relative localisation task were distributed across the contralateral hemisphere, rather than clustered at 90 as predicted by the two channel model. Decoding of location from populations of neurons using two-channel or labelled-line maximum-likelihood decoders indicated that both decoders performed as well as ferrets localising sounds in the same testing chamber but that the labelled-line decoder out-performed the two-channel decoder. Finally, the necessity for an intact auditory cortex for sound localisation was confirmed after developing cortical cooling in the ferret as a method to reversibly silence areas of cortex during behaviour
