Driven by current virtual reality developments and applications in film, television and home entertainment the binaural systems are becoming more and more important – often for practical reasons, for mobile consumer applications as well as high-quality playback of channel- or object-related 3D recordings. Appropriate quality of headphone based reproduction requires precisely brain-minded device design. Special attention must be given to the processing of spectral cues of the brain. Why does the HRTF amplitude spectrum effect distance perception but not produce corresponding coloration? Why do we locate sources out of the head? How can we avoid localisation inside the head? Answers can be given by understanding perceptions as sensory events caused by stimuli that are mapped to the outside world as a result of sensory experience. Special dummy head recordings will be presented to demonstrate corresponding binaural phenomena. Practical consequence for the design of high-quality headphone-based virtual listening rooms or loudspeaker-based virtual headphones is the need of precise HRTF replication as well as head-tracking application for ensuring correct localisation, spatial impression and sound colour.