A new framework for the understanding of functional relationships between perception and action is discussed. According to this framework, perceived events and planned actions share a common representational domain (common-coding approach). Supporting evidence from two classes of experimental paradigms is presented: induction paradigms and interference paradigms. Induction paradigms study how certain stimuli induce certain actions by virtue of similarity. Evidence from two types of induction tasks is reviewed: sensorimotor synchronisation and spatial compatibility tasks. Interference paradigms study the mutual interference between the perception of ongoing events and the preparation and control of ongoing action. Again, evidence from two types of such tasks is reviewed, implying interference in either direction. It is concluded that the evidence available supports the common coding principle. A further general principle emerging from these studies is the action effect principle that is, the principle that cognitive representations of action effects play a critical role in the planning and control of these actions.