The use of audio systems that employ binaural synthesis with head tracking has become increasingly popular, particularly in virtual reality gaming systems. The binaural synthesis process uses the Head-Related Transfer Functions (HRTF) as an input required to assign the directions of arrival to sounds coming from virtual sound sources in the created virtual environments. Generic HRTFs are often used for this purpose to accommodate all potential listeners. The hypothesis of the research is that the use of individual HRTF in binaural synthesis instead of generic HRTF leads to improved accuracy and quality of virtual sound source localization, thus enhancing the user experience. A novel methodology is proposed that involves the use of dynamic virtual sound sources. In the experiments, the test participants were asked to determine the direction of a dynamic virtual sound source in both the horizontal and vertical planes using both generic and individual HRTFs. The gathered data are statistically analyzed, and the accuracy of localization is assessed with respect to the type of HRTF used. The individual HRTFs of the test participants are measured using a novel and efficient method that is accessible to a broad range of users.