The current study explores how individuals' tendency to empathize with others (trait empathy) modulates interaction and social entrainment in dyadic dance in a free movement context using perceptual and computationally derived measures. Stimuli consisting of 24 point-light animations were created using motion capture data selected from a sample of 99 dyads, based on self-reported trait empathy. Individuals whose Empathy Quotient (EQ) scores were in the top or bottom quartile of all scores were considered to have high or low empathy, respectively, and twelve dyads comprised of four high-high, four low-low, and four high-low empathy combinations were identified. Animations of these dyads were presented to 33 participants, who rated the degree of interaction and movement similarity for each stimulus. Results showed a significant effect of empathy combination on perceived interactivity and perceived similarity. High-low stimuli were rated as significantly more interactive than either high-high or low-low stimuli, while high-high stimuli were rated as significantly less similar than high-low and low-low. Dyads’ period-locking, bodily orientation and amount of hand movement were all significantly correlated with rated amount of interaction, while rated similarity only related significantly to period-locking. Results suggest that period-locking is important for social entrainment to be perceived, but that other signals such as bodily orientation and hand movement also signal social entrainment during free dance movement.