It's difficult to create 3D images on a 2D surface because, well, you're missing a whole dimension. Enter Beyond, a collapsible input device that virtually extends the pen into the screen to create the 3D effect.
Beyond was created by the MIT Media Lab and is a pretty genius, glasses-less way to create 3D on a 2D surface. The 3D on 2D surface magic uses the collapsible pen, a tabletop display, an infrared position tracking system to track the pen, and a camera to track the user's face so it can tweak the angle of the 3D effect. The collapsible pen is actually rather simple, with only basic electronics and 2 infrared markers behind the magic.
The idea is that whatever you push in physically with the pen is rendered virtually on the screen, letting you draw all the crazy shapes, objects, and dongs you want. However, as 3D continues its takeover of the world, we're pretty sure tools like Beyond will find better uses than dong drawing. [DesignBoom]