Like 'lenore' said, it had a bad inner CV joint and needed the drive axle (passenger side) replaced. Bought on-line for about $100, replaced it myself. NOT a piece of cake, however. There were a lot of seized bolts and cotter pins (especially the drive shaft in the hub assemby, the cotter pin in the ball joint nut and the 6 bolts that attach the inner CV joint to the tranny). Required impact hammer, penetrating lube, propane torch, a 5lb hammer and a cheater pipe.
One suggestion that I got off the internet - when disconnecting the ball joint, don't remove the cotter pin and main bolt (the one that points vertically) - there is very little room (too little to even get the box end of a wrench on it and the open end was stripping the nut) - instead remove the 3 bolts from the control arm (very easy access with a socket). This way you also don't need any special tools and are not as likely to damage the ball joint.
FWIW - I don't have a Lexus dealership nearby - went to Toyota - mechanic drove the car and told me the clicking sound was from a rock stuck in the wheel! Goes to show that anything a mechanic says should be subject to scrutiny.