A new method of studying vertical localization is described whereby the high‐frequency response of the external ear is synthesized by a computer program incorporating two variable latency delay and add processes. The resulting sounds were evaluated by presentation to subjects via headphones which bypass the external ear. Vertical movement of the sound source was perceived when the latency of one echo was changed dynamically between 100 and 300 μs and this effect required the presence of high‐frequency signal components (above around 4 kHz). In further experiments, the variation of perceived elevation with echo delay was measured, and it is shown that the vertical locale of the apparent source is a monotonic function of echo latency in the 160–260 μs region. It is proposed that locale is decoded by a form of spectral pattern recognition, whereby the locale of the source is represented as a peak on an autocorrelation function. The time‐axis values (between 160 and 260 μs) corresponding to these peaks are considered to correspond to vertical locale for elevations between, roughly, 60° above horizontal and 40° below.