Spatial release from masking (SRM), a factor in listening in noisy environments, is the improvement in auditory signal detection obtained when a signal is separated in space from a masker. To study the neural mechanisms of SRM, we recorded from single units in the inferior colliculus (IC) of barbiturate-anesthetized cats, focusing on low-frequency neurons sensitive to interaural time differences. The stimulus was a broadband chirp train with a 40-Hz repetition rate in continuous broadband noise, and the unit responses were measured for several signal and masker (virtual) locations. Masked thresholds (the lowest signal-to-noise ratio, SNR, for which the signal could be detected for 75% of the stimulus presentations) changed systematically with signal and masker location. Single-unit thresholds did not necessarily improve with signal and masker separation; instead, they tended to reflect the units' azimuth preference. Both how the signal was detected (through a rate increase or decrease) and how the noise masked the signal response (suppressive or excitatory masking) changed with signal and masker azimuth, consistent with a cross-correlator model of binaural processing. However, additional processing, perhaps related to the signal's amplitude modulation rate, appeared to influence the units' responses. The population masked thresholds (the most sensitive unit's threshold at each signal and masker location) did improve with signal and masker separation due to the variety of azimuth preferences in our unit sample. The population thresholds were similar to human behavioral thresholds in both SNR value and shape, indicating that these units may provide a neural substrate for low-frequency SRM.