In this paper we present a system that electromagnetically tracks the positions and orientations of multiple wireless objects on a tabletop display surface. The system offers two types of improvements over existing tracking approaches such as computer vision. First, the system tracks objects quickly and accurately without susceptibility to occlusion or changes in lighting conditions. Second, the tracked objects have state that can be modified by attaching physical dials and modifiers. The system can detect these changes in realtime. We present several new interaction techniques developed in the context of this system. Finally, we present two applications of the system: chemistry and system dynamics simulation. Keywords Tangible user interface, interactive surface, object tracking, two-handed manipulation, system dynamics, augmented reality