A new penetration avoidance mechanism based on forward prevention was proposed to improve the real time performance and reality of collision detection in virtual assembly systems. In virtual assembly manipulation, grasp and release of virtual objects and penetration avoidance were implemented using an OBB algorithm and a hierarchical detection method to avoid artifact caused by a traditional penetration avoidance algorithm. The proposed algorithm, with the help of a data glove and a tracker with 6 DOF, was applied to a simulation experiment on the virtual assembly of a set of motor shell moulds that had a large virtual scene in a semi-immersive virtual environment. The simulation result demonstrated that the virtual assembly system provided realistic assembly operation for the millisecond collision response without penetration.