Humans normally listen in mixed environments, in which sounds originating from more than one source overlap in time and in frequency. The auditory system is able to extract information specific to the individual sources that contribute to the composite signal and process the information for each source separately; this is called “auditory scene analysis” or “sound-source determination.” Sounds that are simultaneously present but generated independently tend to differ along relatively simple acoustic dimensions. These dimensions may be temporal, as when sounds begin or end asynchronously, or spectral, as when the sounds have different fundamental frequencies. Psychophysical experiments have identified some of the ways in which human listeners use these dimensions to isolate sources of sound. A simple but useful stimulus, a harmonic complex tone with or without a mistuned component, can be used for parametric investigation of the processing of spectral structure. This “mistuned tone” stimulus has been used in several psychophysical experiments, and more recently in studies that specifically address the neural mechanisms that underlie segregation based on harmonicity. Studies of the responses of single neurons in the chinchilla auditory system to mistuned tones are reviewed here in detail. The results of those experiments support the view that neurons in the inferior colliculus (IC) exhibit responses to mistuned tones that are larger and temporally more complex than the same neurons’ responses to harmonic tones. Mistuning does not produce comparable changes in the discharge patterns of auditory nerve (AN) fibers, indicating that a major transformation in the neural representation of harmonic structure occurs in the auditory brainstem. The brainstem processing that accomplishes this transformation may contribute to the segregation of competing sounds and ultimately to the identification of sound sources.