The lateralization of clicks and their "echoes" was investigated with a view to determining the role of spectral characteristics in lateralization. Lateralization-discrimination performance was measured in a number of two-interval, two-alternative forced-choice experiments using three pairs of binaural clicks designed to elucidate how spectral cues are used in lateralization. The stimulus in one observation interval comprised a diotic click followed, after the interclick interval (ICI), by a dichotic click with either (1) an interaural time delay or (2) an interaural amplitude difference. The dichotic click was in turn followed, after an ICI of the same size, by another diotic click. In the second observation interval, the signals to the two ears were interchanged. The stimulus has the property that the signals delivered to the two ears had either (1) identical energy-density spectra but nonzero interaural-phase differences (IPDs) or (2) zero IPDs but nonidentical energy-density spectra. Under certain circumstances, observers perceived these stimuli as arising from the side of the head opposite that which would be predicted from the direction of the interaural cue in the temporal waveform. Joint consideration of the psychophysical data and the spectral characteristics of the stimuli strongly suggest a spectral "dominance region" for lateralization near 750 Hz, observers' lateralization performance was determined predominantly by the IPD cues from this region. In general, the results demonstrate that echoes of transients that arrive within about 2-3 ms of an initial transient are not suppressed, but have a substantial effect on lateralization through their contribution to the resultant spectral characteristics. The results contradict models that represent the precedence effect as the temporary suppression or inhibition of directional information in echoes over 2-3 ms after an initial transient.