Audio coding based on Frequency Domain Linear Prediction (FDLP) uses auto-regressive model to approximate Hilbert envelopes in frequency sub-bands for relatively long temporal segments. Although the basic technique achieves good quality of the reconstructed signal, there is a need for improving the coding efficiency. In this paper, we present a novel method for the application of temporal masking to reduce the bit-rate in a FDLP based codec. Temporal masking refers to the hearing phenomenon, where the exposure to a sound reduces response to following sounds for a certain period of time (up to 200 ms). In the proposed version of the codec, a first order forward masking model of the human ear is implemented and informal listening experiments using additive white noise are performed to obtain the exact noise masking thresholds. Subsequently, this masking model is employed in encoding the subband FDLP carrier signal. Application of the temporal masking in the FDLP codec results in a bit...