Binaural hearing is critically important for the perception of sound spatial locations. The primary auditory cortex (AI) has been demonstrated to be necessary for sound localization. However, after hearing onset, how the processing of binaural cues by AI neurons develops, and how the binaural processing of AI neurons is affected by reversible unilateral conductive hearing loss (RUCHL), are not fully elucidated. Here, we determined the binaural processing of AI neurons in four groups of rats: postnatal day (P) 14-18 rats, P19-30 rats, P57-70 adult rats, and RUCHL rats (P57-70) with RUCHL during P14-30. We recorded the responses of AI neurons to both monaural and binaural stimuli with variations in interaural level differences (ILDs) and average binaural levels. We found that the monaural response types, the binaural interaction types, and the distributions of the best ILDs of AI neurons in P14-18 rats are already adult-like. However, after hearing onset, there exist developmental refinements in the binaural processing of AI neurons, which are exhibited by the increase in the degree of binaural interaction, and the increase in the sensitivity and selectivity to ILDs. RUCHL during early hearing development affects monaural response types, decreases the degree of binaural interactions, and decreases both the selectivity and sensitivity to ILDs of AI neurons in adulthood. These new evidences help us to understand the refinements and plasticity in the binaural processing of AI neurons during hearing development, and might enhance our understanding in the neuronal mechanism of developmental changes in auditory spatial perception.