Contrast-modulated (CM) stimuli are processed by spatial mechanisms that operate at larger spatial scales than those processing luminance-modulated (LM) stimuli and may be more prone to deficits in developing, amblyopic, and aging visual systems. Understanding neural mechanisms of contour interaction or crowding will help in detecting disorders of spatial vision. In this study, contour interaction effects on visual acuity for LM and CM C and bar stimuli are assessed in normal foveal vision. In Experiment 1, visual acuity is measured for all-LM and all-CM stimuli, at ~3.5× above their respective modulation thresholds. In Experiment 2, visual acuity is measured for Cs and bars of different type (LM C with CM bars and vice versa). Visual acuity is degraded for CM compared with LM Cs (0.46 ± 0.04 logMAR vs. 0.18 ± 0.04 logMAR). With nearby bars, CM acuity is degraded further (0.23 ± 0.01 logMAR or ~2 lines on an acuity chart), significantly more than LM acuity (0.11 ± 0.01 logMAR, ~1 line). Contour interaction for CM stimuli extends over greater distances (arcmin) than it does for LM stimuli, but extents are similar with respect to acuities (~3.5× the C gap width). Contour interaction is evident when the Cs and bars are defined differently: it is stronger when an LM C is flanked by CM bars (0.17 ± 0.03 logMAR) than when a CM C is flanked by LM bars (0.08 ± 0.02 logMAR). Our results suggest that contour interaction for foveally viewed acuity stimuli involves feature integration, such that the outputs of receptive fields representing Cs and bars are combined. Contour interaction operates at LM and CM representational stages, it can occur across stage, and it is enhanced at the CM stage. Greater contour interaction for CM Cs and bars could hold value for visual acuity testing and earlier diagnosis of conditions for which crowding is important, such as in amblyopia.