Whereas naturally occurring swarms thrive when crowded, physical interactions in robotic swarms are either avoided or carefully controlled, thus limiting their operational density. Here, we present a mechanical design rule that allows robots to act in a collision-dominated environment. We introduce Morphobots, a robotic swarm platform developed to implement embodied computation through a morpho-functional design. By engineering a three-dimensional printed exoskeleton, we encode a reorientation response to an external body force (such as gravity) or a surface force (such as a collision). We show that the force orientation response is generic and can augment existing swarm robotic platforms (e.g., Kilobots) as well as custom robots even 10 times larger. At the individual level, the exoskeleton improves motility and stability and also allows encoding of two contrasting dynamical behaviors in response to an external force or a collision (including collision with a wall or a movable obstacle and on a dynamically tilting plane). This force orientation response adds a mechanical layer to the robot's sense-act cycle at the swarm level, leveraging steric interactions for collective phototaxis when crowded. Enabling collisions also promotes information flow, facilitating online distributed learning. Each robot runs an embedded algorithm that ultimately optimizes collective performance. We identify an effective parameter that controls the force orientation response and explore its implications in swarms that transition from dilute to crowded. Experimenting with physical swarms (of up to 64 robots) and simulated swarms (of up to 8192 agents) shows that the effect of morphological computation increases with growing swarm size.