In this paper, we describe the effects of shadow representation of virtual objects in Augmented Reality. Optical consistency is important in order to create realistic augmented reality environments. We focus on providing accurate shadows and made two assumptions about the effects of shadow representation of virtual objects. First, that the shadow of virtual objects provides a stronger connection between the real world and virtual objects and so increases virtual object presence. Second, that the shadow of virtual objects provides depth cues and so makes three-dimensional perceptions easier for the users of the interface. We report on two experiments that show that these assumptions are correct. We also find that users report that a characteristic shadow shape provides more virtual object presence in spite of incorrect virtual light direction.