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In this paper, we present a method for automatic, online detection of a user's interaction with objects. This represents an essential building block for improving the performance of distributed activity recognition systems. Our method is based on correlating features extracted from motion sensors worn by the user and attached to objects. We present a complete implementation of the idea, using miniaturized wireless sensor nodes equipped with motion sensors. We achieve a recognition accuracy of 97% for a target response time of 2 seconds. The implementation is lightweight, with low communication bandwidth and processing needs. We illustrate the potential of the concept by means of an interactive multi-user game.