A microsurgical simulation system includes a display for providing a virtual simulation of images of a model of a human eye and a hand-held tool for simulating a surgical tool. The hand-held tool comprises a position and orientation sensor for supplying positional signals to a processor to indicate a position and orientation of the hand held tool and a tracking system for supplying measurement signals to the processor to indicate a linear distance between a first component and a second component of the hand-held tool. A virtual representation of the hand-held tool is presented on the display, and the appearance and positioning of the virtual representation of the hand-held tool is based on the positional signals and measurement signals supplied to the processor by the hand-held device.