Free-field source localization experiments with 30 source locations, symmetrically distributed in azimuth, elevation, and front-back location, were performed with periodic tones having different phase relationships among their components. Although the amplitude spectra were the same for these different kinds of stimuli, the tones with certain phase relationships were successfully localized while the tones with other phases led to large elevation errors and front-back reversals, normally growing with stimulus level. The results show that it is not enough to have a smooth, broadband, long-term signal spectrum for successful sagittal-plane localization. Instead, temporal factors are important. A model calculation investigates the idea that the tonotopic details that mediate localization need to be simultaneously, or almost simultaneously, accessible in the auditory system in order to achieve normal elevation perception. A qualitative model based on lateral inhibition seems capable in principle of accounting for both the phase effects and level effects.