Sound localization cues generally include interaural time difference (ITD), interaural intensity difference (IID) and spectral cues. The purpose of a series studies in this book is to investigate the important spectral cues involved in so-called head related transfer functions (HRTFs) using a combination of HRTF analyzes and a virtual sound localization (VSL) experiment. Previous Psychoacoustical and physiological studies have both suggested the existence of spectral modulation frequency (SMF) channels for analyzing spectral information (e.g. the spectral cues coded in HRTFs). SMFs are in a domain related to the Fourier transform of HRTFs. The relationship between various SMF regions and sound localization was tested here by filtering or enhancing HRTFs in the SMF domain under a series of conditions using a VSL experiment.The overall results highlighted the relationship between SMF region and sound localization in the vertical plane. Knowledge of the influence of manipulations in the SMF domain on sound localization has implications for the application of various signal processing algorithms and models of monaural and binaural hearing.