Stereo recordings are used in FM broadcasting and Digital Audio Broadcasting (DAB) and in several television systems. To record in stereo, sound engineers use various methods, including using two directional microphones, two parallel omnidirectional microphones, or more complex techniques. Several monophonic records, such as the original Broadway cast recordings of Oklahoma! (1943), Carousel (1945), and South Pacific (1949), were once reissued in "fake" stereo to create the impression that the sound was originally recorded in that medium.

The first stereo transmission was made telephonically by Clément Ader in 1881. The BBC made radio's first stereo broadcast in December 1925. In the 1930s, Alan Blumlein of EMI patented stereo records, stereo films, and also surround sound. Harvey Fletcher of Bell Laboratories investigated techniques for stereophonic recording and reproduction. The first commercial motion picture to be exhibited with stereophonic sound was Walt Disney's Fantasia (1940). By the mid-1950s, multichannel sound was common for big-budget Hollywood motion pictures. In 1953, Remington Records began taping some of its sessions in stereo, with the first stereophonic phonograph discs available to the general public in 1958. The U.S. Federal Communications Commission announced stereophonic FM broadcasting technical standards in April 1961, and licensed regular stereophonic FM radio broadcasting, to commence that same year. In 1984, multichannel television sound was adopted by the FCC as the United States standard for stereo television transmission.

The word stereophonic derives from the Greek "στερεός" (stereos), "firm, solid" + "φωνή" (phōnē), "sound, tone, voice" and it was coined 1927 by Western Electric, by analogy with the word "stereoscopic". In popular usage, stereo usually means two-channel sound recording and sound reproduction using data for more than one speaker simultaneously. In technical usage, stereo or stereophony means sound recording and sound reproduction that uses stereographic projection to encode the relative positions of objects and events recorded. A stereo system can include any number of channels, such as the surround sound 5.1- and 6.1-channel systems used on high-end film and television productions. However, in common use it refers to systems with only two channels. The electronic device for playing back stereo sound is often referred to as a "stereo".

During two-channel stereo recording, two microphones are placed in strategically chosen locations relative to the sound source, with both recording simultaneously. The two recorded channels will be similar, but each will have distinct time-of-arrival and sound-pressure-level information. During playback, the listener's brain uses those subtle differences in timing and sound level to triangulate the positions of the recorded objects. Stereo recordings often cannot be played on monaural systems without a significant loss of fidelity. Since each microphone records each wavefront at a slightly different time, the wavefronts are out of phase; as a result, constructive and destructive interference can occur if both tracks are played back on the same speaker. This phenomenon is known as phase cancellation.

Here, two directional microphones are at the same place, typically pointing at an angle between 90° and 135° to each other (see also "The Stereophonic Zoom" by Michael Williams). The stereo effect is achieved through differences in sound pressure level between two microphones. A difference in levels of 18 dB (16 to 20 dB) is needed for hearing the direction of a loudspeaker. Due to the lack of differences in time-of-arrival/phase ambiguities, the sonic characteristic of X-Y recordings has less sense of space and depth when compared to recordings employing an A-B setup. When two figure-eight microphones are used, facing ±45° with respect to the sound source, the X-Y setup is called a Blumlein Pair. The sonic image produced is realistic, almost "holographic". (See also acoustic intensity).

This uses two parallel omnidirectional microphones some distance apart, capturing time-of-arrival stereo information as well as some level (amplitude) difference information—especially if employed in close proximity to the sound source(s). At a distance of about 60 cm (0.6 m), the time delay (time-of-arrival difference) for a signal reaching the first microphone and then the other one from the side is approximately 1.5 msec (1 to 2 msec). If you increase the distance between the microphones, you effectively decrease the pickup angle. At a 70 cm distance, it is approximately equivalent to the pickup angle of the near-coincident ORTF setup.

This technique can produce phase issues when the stereo signal is mixed to mono.

This coincident technique employs a bidirectional microphone facing sideways and another microphone (generally a variety of cardioid, although Alan Blumlein described the usage of an omnidirectional transducer in his original patent) at an angle of 90°, facing the sound source. The left and right channels are produced through a simple matrix: Left = Mid + Side; Right = Mid − Side (the polarity-reversed side signal). This configuration produces a completely mono-compatible signal and, if the Mid and Side signals are recorded (rather than the matrixed Left and Right), the stereo width can be manipulated after the recording has taken place. This makes it especially useful for film-based projects.

These techniques combine the principles of both A-B and X-Y (coincident pair) techniques. For example, the ORTF stereo technique of the Office de Radiodiffusion Télévision Française (Radio France) calls for a pair of cardioid microphones placed 17 cm apart at a total angle between microphones of 110°, which results in a stereophonic pickup angle of 96° (Stereo Recording Angle, or SRA). In the NOS stereo technique of the Nederlandse Omroep Stichting (Holland Radio), the total angle between microphones is 90° and the distance is 30 cm, thus capturing time-of-arrival stereo information as well as level information. It is noteworthy that the spacing of 17 cm has nothing to do with human ear distance. The recorded signals are generally intended for playback over stereo loudspeakers, not earphones.

In the course of restoration or remastering of monophonic records, various techniques of "pseudo-stereo", "quasi-stereo", or "rechanneled stereo" have been used to create the impression that the sound was originally recorded in stereo. These techniques first involved hardware methods (see Duophonic) or, more recently, a combination of hardware and software. Multitrack Studio, from Bremmers Audio Design (The Netherlands), uses special filters to achieve a pseudo-stereo effect: the "shelve" filter directs low frequencies to the left channel and high frequencies to the right channel, and the "comb" filter adds a small delay in signal timing between the two channels, a delay barely noticeable by ear (the comb filter allows range of manipulation between 0 and 100 milliseconds), but contributing to an effect of "widening" original "fattiness" of mono recording.