With the expansion of the internet and its bandwidth, distributed virtual environment (DVE) applications have become more prevalent. In DVE applications, users frequently crowd in a specific place, and a key aspect to consider is how to provide interactive performance for users. However, existing approaches using multicast require users to receive uninteresting messages. Even though recent works have addressed fine-grained filtering, they still incur other drawbacks in terms Of assigning lots of multicast addresses or handling overhead of multicast groups. This makes the system less scalable as the number of users increases. In this paper, we propose a new scalable filtering scheme that reduces not only the number of messages during interaction in a region and among neighboring regions, but also the number of multicast addresses without significant computational overhead. Interest management in a region dynamically creates groups of users with the same interests. While members communicate with each other with high fidelity, a representative sends information to non-members with low frequency. For interaction among neighboring regions, we propose a sub-region concept to select only a subset of users from the neighboring regions based on proximity, the distribution of the users' locations, and the viewing direction of a user. Copyright (c) 2007 John Wiley & Sons, Ltd.