I won’t even try to explain how this works, but its pretty amazing. The creators at Tangible Media Group sum it up as –

“inFORM is a Dynamic Shape Display that can render 3D content physically, so users can interact with digital information in a tangible way. inFORM can also interact with the physical world around it, for example moving objects on the table’s surface. Remote participants in a video conference can be displayed physically, allowing for a strong sense of presence and the ability to interact physically at a distance. inFORM is a step toward our vision of Radical Atoms: tangible.media.mit.edu/vision/ ”

If you’d like to read more about this project you can visit their site here