Auditory steady-state responses (ASSR) are induced from the brainstem to the neocortex when humans hear periodic amplitude-modulated tonal signals. ASSRs have been argued to be a key marker of auditory temporal processing and pathological reorganization of ASSR – a biomarker of neurodegenerative disorders. However, most of the earlier studies reporting the neural basis of ASSRs were focused on looking at individual brain regions. Here, we seek to characterize the large-scale directed information flow among cortical sources of ASSR entrained by 40 Hz external signals. Entrained brain rhythms with power peaking at 40 Hz were generated using both monaural and binaural tonal stimulation. First, we confirm the presence of ASSRs and their well-known right hemispheric dominance during binaural and both monaural conditions. Thereafter, reconstruction of source activity employing individual anatomy of the participant and subsequent network analysis revealed that while the sources are common among different stimulation conditions, differential levels of source activation and differential patterns of directed information flow among sources underlie processing of binaurally and monaurally presented tones. Particularly, we show bidirectional interactions involving the right superior temporal gyrus and inferior frontal gyrus underlie right hemispheric dominance of 40 Hz ASSR during both monaural and binaural conditions. On the other hand, for monaural conditions, the strength of inter-hemispheric flow from left primary auditory areas to right superior temporal areas followed a pattern that comply with the generally observed contralateral dominance of sensory signal processing.