Professor Hiroshi Ishii and his students at the MIT Media Lab have created an interface that can remotely replicate in real-time objects placed under its sensors.
The video demonstrates how a ball can be "carried" with the operators hands or a bowl.
The basic premise behind the technology is quite simple - a camera traces movement in 3D, this is processed by a computer and the motion is replicated by rods.
Obviously the technology is still in it's infancy but the potential is huge.