This is some cool tech. You place a card on a surface, and as long as the 3DS can detect the card, it can manipulate objects such as Miis into the environment shown on your twin cameras. There are 6 cards in all (though only one was shown in the demo) and they are used to do funny things and play some games. Of course, they come with the console and are all free.
The detection seems to be a lot better than the ambitious head-tracking from DSi, which the console simply wasn't powerful enough for.
