The principles underlying functional asymmetries in cortex remain debated. For example, it is accepted that speech is processed bilaterally in auditory cortex, but a left hemisphere dominance emerges when the input is interpreted linguistically. The mechanisms, however, are contested, such as what sound features or processing principles underlie laterality. Recent findings across species (humans, canines and bats) provide converging evidence that spectrotemporal sound features drive asymmetrical responses. Typically, accounts invoke models wherein the hemispheres differ in time-frequency resolution or integration window size. We develop a framework that builds on and unifies prevailing models, using spectrotemporal modulation space. Using signal processing techniques motivated by neural responses, we test this approach, employing behavioural and neurophysiological measures. We show how psychophysical judgements align with spectrotemporal modulations and then characterize the neural sensitivities to temporal and spectral modulations. We demonstrate differential contributions from both hemispheres, with a left lateralization for temporal modulations and a weaker right lateralization for spectral modulations. We argue that representations in the modulation domain provide a more mechanistic basis to account for lateralization in auditory cortex.