Binaural cue coding (BCC) is an efficient technique for spatial audio rendering by using the side information such as interchannel level difference (ICLD), interchannel time difference (ICTD), and interchannel correlation (ICC). Of the side information, the ICTD plays an important role to the auditory spatial image. However, inaccurate estimation of the ICTD may lead to the audio quality degradation. In this paper, we develop a novel ICTD estimation algorithm based on the nonuniform discrete Fourier transform (NDFT) and integrate it with the BCC approach to improve the decoded auditory image. Furthermore, a new subjective assessment method is proposed for the evaluation of auditory image widths of decoded signals. The test results demonstrate that the NDFT-based scheme can achieve much wider and more externalized auditory image than the existing BCC scheme based on the discrete Fourier transform (DFT). It is found that the present technique, regardless of the image width, does not deteriorate the sound quality at the decoder compared to the traditional scheme without ICTD estimation.