  Upgrades beyond the current second generation of ground-based gravitational
wave detectors will allow them to observe tens of thousands neutron star and
black hole binaries. Given the typical minute-to-hour duration of neutron star
signals in the detector frequency band, a number of them will overlap in the
time-frequency plane resulting in a nonzero cross-correlation. We examine
source confusion arising from overlapping signals whose time-frequency tracks
cross. Adopting the median observed merger rate of $100$ Gpc$^{-3}$yr$^{-1}$,
each neutron star binary signal overlaps with an average of 42(4)[0.5] other
signals when observed from 2(5)[10] Hz. The vast majority of overlaps occur at
low frequencies where the inspiral evolution is slow: 91% of time-frequency
overlaps occur in band below 5 Hz. The combined effect of overlapping signals
does not satisfy the central limit theorem and source confusion cannot be
treated as stationary, Gaussian noise: on average 0.91(0.17)[0.05] signals are
present in a single adaptive time-frequency bin centered at 2(5)[10] Hz. We
quantify source confusion under a realistic neutron star binary population and
find that parameter uncertainty typically increases by less than 1% unless
there are overlapping signals whose detector-frame chirp mass difference is
$\lesssim 0.01 M_{\odot}$ and the overlap frequency is $\gtrsim$ 40 Hz. Out of
$1\times10^6$ simulated signals, 0.14% fall within this region of
detector-frame chirp mass differences, but their overlap frequencies are
typically lower than 40 Hz. Source confusion for ground-based detectors, where
events overlap instantaneously is significantly milder than the equivalent LISA
problem, where many classes of events overlap for the lifetime of the mission.
