In this study, an augmented reality (AR) e-commerce system was developed and a usability study was conducted to compare the AR e-commerce system with the traditional e-commerce system. The AR e-commerce system was developed as an Internet plug-in, which can be accessed with different computers. Study results show that the AR e-commerce system can provide more information and more direct experiences to online customers, by combining physical environment information with virtual product models. Online shoppers can “test use” products while shopping online and acquire more information about the products. Thus, customers can make better purchasing decisions and have a better chance to purchase the “right” products.