Neural decoding is a tool for understanding how activities from a population of neurons inside the brain relate to the outside world and for engineering applications such as brain-machine interfaces. However, neural decoding studies mainly focused on different decoding algorithms rather than different neuron types which could use different coding strategies. In this study, we used two-photon calcium imaging to assess three auditory spatial decoders (space map, opponent channel, and population pattern) in excitatory and inhibitory neurons in the dorsal inferior colliculus of male and female mice. Our findings revealed a clustering of excitatory neurons that prefer similar interaural level difference (ILD), the primary spatial cues in mice, while inhibitory neurons showed random local ILD organization. We found that inhibitory neurons displayed lower decoding variability under the opponent channel decoder, while excitatory neurons achieved higher decoding accuracy under the space map and population pattern decoders. Further analysis revealed that the inhibitory neurons' preference for ILD off the midline and the excitatory neurons' heterogeneous ILD tuning account for their decoding differences. Additionally, we discovered a sharper ILD tuning in the inhibitory neurons. Our computational model, linking this to increased presynaptic inhibitory inputs, was corroborated using monaural and binaural stimuli. Overall, this study provides experimental and computational insight into how excitatory and inhibitory neurons uniquely contribute to the coding of sound locations.