The tendency to underestimate egocentric distances in immersive virtual environments (VEs) is not well understood. However, previous research (A. R. Richardson & D. Waller, 2007) has demonstrated that a brief period of interaction with the VE prior to making distance judgments can effectively eliminate subsequent underestimation. Here the authors examine the mechanism underlying the effect of VE interaction and the conditions that may give rise to it. In Experiment 1, after interacting with an immersive VE, participants tended to overestimate distances in the physical world, indicating that the interaction involved a recalibration of the perceptual-motor system. Experiment 2 demonstrates that visual information is not necessary (and that body-based information is necessary) during the interaction period for it to have a positive effect on subsequent distance estimation accuracy. Experiment 3 illustrates that the interaction task does not need to be goal directed in order to be effective. (Contains 3 figures.)