Virtual reality applications employing avatar embodiment typically use virtual mirrors to allow users to perceive their digital selves not only from a first-person but also from a holistic third-person perspective. However, due to distance-related biases such as the distance compression effect or a reduced relative rendering resolution, the self-observation distance (SOD) between the user and the virtual mirror might influence how users perceive their embodied avatar. Our article systematically investigates the effects of a short (1 m), middle (2.5 m), and far (4 m) SOD between users and mirror on the perception of their personalized and self-embodied avatars. The avatars were photorealistic reconstructed using state-of-the-art photogrammetric methods. Thirty participants repeatedly faced their real-time animated self-embodied avatars in each of the three SOD conditions, where they were repeatedly altered in their body weight, and participants rated the 1) sense of embodiment, 2) body weight perception, and 3) affective appraisal towards their avatar. We found that the different SODs are unlikely to influence any of our measures except for the perceived body weight estimation difficulty. Here, the participants perceived the difficulty significantly higher for the farthest SOD. We further found that the participants’ self-esteem significantly impacted their ability to modify their avatar’s body weight to their current body weight and that it positively correlated with the perceived attractiveness of the avatar. Additionally, the participants’ concerns about their body shape affected how eerie they perceived their avatars. The participants’ self-esteem and concerns about their body shape influenced the perceived body weight estimation difficulty. We conclude that the virtual mirror in embodiment scenarios can be freely placed and varied at a distance of one to four meters from the user without expecting major effects on the perception of the avatar.