The configuration of lizard ears, where sound can reach both surfaces of the eardrums, produces a strongly directional ear, but the subsequent processing of sound direction by the auditory pathway is unknown. We report here on directional responses from the first stage, the auditory nerve. We used laser vibrometry to measure eardrum responses in Tokay geckos and in the same animals recorded 117 auditory nerve single fiber responses to free-field sound from radially distributed speakers. Responses from all fibers showed strongly lateralized activity at all frequencies, with an ovoidal directivity that resembled the eardrum directivity. Geckos are vocal and showed pronounced nerve fiber directionality to components of the call. To estimate the accuracy with which a gecko could discriminate between sound sources, we computed the Fisher information (FI) for each neuron. FI was highest just contralateral to the midline, front and back. Thus, the auditory nerve could provide a population code for sound source direction, and geckos should have a high capacity to differentiate between midline sound sources. In brain, binaural comparisons, for example, by IE (ipsilateral excitatory, contralateral inhibitory) neurons, should sharpen the lateralized responses and extend the dynamic range of directionality.NEW & NOTEWORTHY In mammals, the two ears are unconnected pressure receivers, and sound direction is computed from binaural interactions in the brain, but in lizards, the eardrums interact acoustically, producing a strongly directional response. We show strongly lateralized responses from gecko auditory nerve fibers to directional sound stimulation and high Fisher information on either side of the midline. Thus, already the auditory nerve provides a population code for sound source direction in the gecko.