Binaural hearing is the ability of the human auditory system to integrate information received from both ears simultaneously. Binaural hearing is fundamental in understanding speech in noisy backgrounds. Any disfunction in one or both ears could cause a disruption in the processing mechanism. Auditory evoked potentials (AEPs) are electrical potentials evoked by externally presented auditory stimuli from any part of the auditory system. A non-invasive technology, electroencephalography (EEG) is used for the monitoring of AEPs. The research aims to identify the best suited electrode positions through correlation analysis and analyse the AEP signals from the selected electrodes in order to detect binaural sensitivity of the human brain. The study evaluates the time-averaged EEG responses of normal hearing subjects to auditory stimuli. The stimuli used for the study are 500 Hz Blackman windowed pure tones, presented in either homophasic (the same phase in both ears) or antiphasic (180-degree phase difference between the two ears) conditions. The study focuses on understanding the effect of phase reversal of auditory stimuli, an under interaural time difference (ITD) cue, on the middle latency response (MLR) region of the AEPs. A correlation analysis was carried out between the eight different locations and as a result, Cz and Pz electrode positions were selected as the best suited positions for further analysis. The selected electrode signals were further processed in the time domain and frequency domain analysis. In the time domain analysis, it was found that Cz electrode for eight subjects out of nine and Pz electrode for seven subjects out of nine, had the larger area under signal curve obtained in the antiphasic condition than in the homophasic signals. Frequency domain analysis showed that the frequency bands 20 to 25Hz and 25 to 30Hz had the most energy when elicited by antiphasic stimuli than by homophasic stimuli. The findings of this study can be further utilised for the detection of binaural processing in a human brain.