Currently industrial design is mainly done by CAD and mock-up is created to evaluate the design. This process is repeated from the rough sketches to the final detailed mock-up until the designer is satisfied. In this process, creating the mock-up, especially detailed mock-up, is quite costly. Hence, there is a need to improve the efficiency of mock-up fabrication. One of the strategies for realizing this is to use virtual models (VM) instead of mock-up. VM is a model which is created on computer by 3D computer graphics, and it allows realistic graphical modeling which can be modified easily, reduces time considerably, and enables dynamic viewing of models from any angle and orientation. Despite this, mock-ups are still required because the process of design evaluation by touching physical models (PM) is still important to designers. To resolve this disadvantage of VM, this paper proposes a new evaluation system for industrial design. With this system, VM and the rapid prototyping mock-up are overlapped in virtual space to produce a tangible VM. This new type of VM functions just like a detailed mock-up but can be created much faster and cheaper. This system employs the concept of Augmented Virtuality (AV), which is mainly based on virtual space and real objects are added to reinforce the virtual space. In this case, haptic information from the rapid prototyping mock-up is added to optical information from the VM. When estimating the 3D position of a real object, optical information is used considerably more than haptic information. Therefore, if there are only a few positional or geometrical differences between the rapid prototyping mock-up and the VM, the differences can be offset by the (incorporated into the) optical information. For this reason, if the designer needs to modify the product shape, only the VM needs to be modified, allowing old mock-ups to be used repeatedly. This means that designers can evaluate a variety of product designs with only one mock-up, thus reducing both time and the costs for creating a mock-up. The operator wears a data glove on his/her hand to construct a virtual hand in the virtual space. With this virtual hand, the operator can also evaluate the user interface (UI) of the product by means of pushing buttons or watching display on the VM. This paper also provides a new method for overlapping the virtual space and real space.