This application discloses an interaction method performed by a display device and the display device. A three-dimensional virtual object may be obtained; an optical signal of the virtual object is transmitted to a first region of a space and then projected from the first region into a second region of the space through the display device, so that an image of the virtual object is generated in the second region of the space that is outside the display device; when it is detected that a user performs a motion sensing operation on the image of the virtual object in the second region of the space, the virtual object is updated based on the motion sensing operation, to obtain an updated virtual object; and an optical signal of the updated virtual object is then used for generating an image of the updated virtual object in the second region of the space.