In wave-type weakly electric fish, two distinct types of primary afferent fibers are specialized for separately encoding modulations in the amplitude and phase (timing) of electrosensory stimuli. Time-coding afferents phase lock to periodic stimuli and respond to changes in stimulus phase with shifts in spike timing. Amplitude-coding afferents fire sporadically to periodic stimuli. Their probability of firing in a given cycle, and therefore their firing rate, is proportional to stimulus amplitude. However, the spike times of time-coding afferents are also affected by changes in amplitude; similarly, the firing rates of amplitude-coding afferents are also affected by changes in phase. Because identical changes in the activity of an individual primary afferent can be caused by modulations in either the amplitude or phase of stimuli, there is ambiguity regarding the information content of primary afferent responses that can result in 'phantom' modulations not present in an actual stimulus. Central electrosensory neurons in the hindbrain and midbrain respond to these phantom modulations. Phantom modulations can also elicit behavioral responses, indicating that ambiguity in the encoding of amplitude and timing information ultimately distorts electrosensory perception. A lack of independence in the encoding of multiple stimulus attributes can therefore result in perceptual illusions. Similar effects may occur in other sensory systems as well. In particular, the vertebrate auditory system is thought to be phylogenetically related to the electrosensory system and it encodes information about amplitude and timing in similar ways. It has been well established that pitch perception and loudness perception are both affected by the frequency and intensity of sounds, raising the intriguing possibility that auditory perception may also be affected by ambiguity in the encoding of sound amplitude and timing.