Methods for generating virtual proxy objects and controlling the location of the virtual proxy objects within an augmented reality environment are described. In some embodiments, a head-mounted display device (HMD) may identify a real-world object for which to generate a virtual proxy object, generate the virtual proxy object corresponding with the real-world object, and display the virtual proxy object using the HMD such that the virtual proxy object is perceived to exist within an augmented reality environment displayed to an end user of the HMD. In some cases, image processing techniques may be applied to depth images derived from a depth camera embedded within the HMD in order to identify boundary points for the real-world object and to determine the dimensions of the virtual proxy object corresponding with the real-world object.