In this paper, we address the problem of designing and implementing low-cost yet effective user interfaces for interactive computer games that heavily use physically-based animation. Due to the nature of a physics-driven gaming setup in our system, we require that the interfaces should mimic the tangibility of real-world interfaces to maximize the playability of the game. Our prototype gaming system, called Space Foosball, is a virtual realization of the real-world foosball in a space-age setting. The biggest challenge to build our system was to design effective and robust interfaces to control the motion of user paddles, which in turn drive the physics simulation of the secondary motion between a soccer ball and the environment, and between a ball and game characters. To meet our tight development budget and schedule, we opted for off-the-shelf optical sensors as a basis of the controlling mechanism. These sensors are low-cost but provided a robust solution to our problem. Another important task to build the Space Foosball was implementing a high-performance game physics engine that suits for simulating the very dynamic foosball environment. To meet this demand, we designed and implemented an in-house physics engine, called Virtual Physics, based on a mathematical formulation of Lie groups. In less than a short period of two months, we successfully built our prototype gaming system which effectively utilizes tangible interfaces while robustly simulating the game physics environment.