The owl can discriminate changes in the location of sound sources as small as 3 degrees and can aim its head to within 2 degrees of a source. A typical neuron in its midbrain space map has a spatial receptive field that spans 40 degrees--a width that is many times the behavioural threshold. Here we have quantitatively examined the relationship between neuronal activity and perceptual acuity in the auditory space map in the barn owl midbrain. By analysing changes in firing rate resulting from small changes of stimulus azimuth, we show that most neurons can reliably signal changes in source location that are smaller than the behavioural threshold. Each source is represented in the space map by a focus of activity in a population of neurons. Displacement of the source causes the pattern of activity in this population to change. We show that this change predicts the owl's ability to detect a change in source location.