Wireless sensor networks have been attracting increasing research interest given the recent advances in microelectronics, array processing, and wireless networking. Consisting of a large collection of small, wireless, low-cost, integrated sensing, computing, and communicating nodes capable of performing various demanding collaborative space-time processing tasks, wireless sensor network technology poses various unique design challenges, particularly for real-time operation. In this paper, we review the Approximate Maximum-Likelihood (AML) method for source localization and direction-of-arrival (DOA) estimations. Then, we consider the use of least-squares (LS) method applied to DOA bearing crossings to perform source localization. A novel virtual array model applicable to the AML-DOA estimation method is proposed for reverberant scenarios. Details on the wireless acoustical testbed are given. We consider the use of Compaq iPAQ 3760s, which are handheld, battery-powered device normally meant to be used as personal organizers (PDAs), as sensor nodes. The iPAQ provide a reasonable balance of cost, availability, and functionality. It has a build-in StrongARM processor, microphone, codec for acoustic acquisition and processing, and a PCMCIA bus for external IEEE 802.11b wireless cards for radio communication. The iPAQs form a distributed sensor network to perform real-time acoustical beamforming. Computational times and associated real-time processing tasks are described. Field measured results for linear, triangular, and square subarrays in free-space and reverberant scenarios are presented. These results show the effective and robust operation of the proposed algorithms and their implementations on a real-time acoustical wireless testbed.