Physical proximity is important in social interactions. Here, we assessed whether simulated physical proximity modulates the perceived intensity of facial emotional expressions and their associated physiological signatures during observation or imitation of these expressions. Forty-four healthy volunteers rated intensities of dynamic angry or happy facial expressions, presented at two simulated locations, proximal (0.5 m) and distant (3 m) from the participants. We tested whether simulated physical proximity affected the spontaneous (in the observation task) and voluntary (in the imitation task) physiological responses (activity of the corrugator supercilii face muscle and pupil diameter) as well as subsequent ratings of emotional intensity. Angry expressions provoked relative activation of the corrugator supercilii muscle and pupil dilation, whereas happy expressions induced a decrease in corrugator supercilii muscle activity. In proximal condition, these responses were enhanced during both observation and imitation of the facial expressions, and were accompanied by an increase in subsequent affective ratings. In addition, individual variations in condition related EMG activation during imitation of angry expressions predicted increase in subsequent emotional ratings. In sum, our results reveal novel insights about the impact of physical proximity in the perception of emotional expressions, with early proximity-induced enhancements of physiological responses followed by an increased intensity rating of facial emotional expressions.