A distributed sensor network has a base station and clusters of sensor nodes. In a method of locating and classifying signal sources, at each node divides a received signal into blocks, performs Fourier-based transform on the blocks, selects peaks from the transformed blocks, selects subbands with features of interest based on the frequency of occurrence of the peaks across the blocks, collaborates with other nodes in the cluster to make a final selection of the subbands, encodes the subband features of the signal, and transmits the subband features to the base station. The base station processes the received subband features to locate and classify the signal sources.