When another person's actions are observed it appears that these actions are simulated, such that similar motor processes are triggered in the observer. Much evidence suggests that such simulation concerns the achievement of behavioural goals, such as grasping a particular object, and is less concerned with the specific nature of the action, such as the path the hand takes to reach the goal object. We demonstrate that when observing another person reach around an obstacle, an observer's subsequent reach has an increased curved trajectory, reflecting motor priming of reach path. This priming of reach trajectory via action observation can take place under a variety of circumstances: with or without a shared goal, and when the action is seen from a variety of perspectives. However, of most importance, the reach path priming effect is only evoked if the obstacle avoided by another person is within the action (peripersonal) space of the observer.