Augmented reality (AR) is a technology in which a user's view of the real world is enhanced or augmented with additional information generated from a computer model. Using AR technology, users can interact with a combination of real and virtual objects in a natural way. This paradigm constitutes the core of a very promising new technology for many applications. However, before it can be applied successfully, AR has to fulfill very strong requirements including precise calibration, registration and tracking of sensors and objects in the scene, as well as a detailed overall understanding of the scene. We see computer-vision and image-processing technology playing an increasing role in acquiring appropriate sensor and scene models. To balance robustness with automation, we integrate automatic image analysis with both interactive user assistance and input from magnetic trackers and CAD models. Also, in order to meet the requirements of the emerging global information society, future human-computer interaction will be highly collaborative and distributed. We thus conduct research pertaining to distributed and collaborative use of AR technology. We have demonstrated our work in several prototype applications, such as collaborative interior design and collaborative mechanical repair. This paper describes our approach to AR with examples from applications, as well as describing the underlying technology.