Two-point discrimination threshold depends on the number and size of receptive fields between the touches. But what determines the size of the receptive fields? Are they anatomically fixed? Or are they related to perceived body size? To answer this question we manipulated perceived arm length using the Pinocchio illusion. The test arm was held at the wrist and the holding arm was made to feel perceptually more extended than it was by applying vibration to the tendon of the biceps (c.f. de Vignemont et al., 2005). For control trials the holding arm was vibrated elsewhere. An array of tactors, separated by 3cm, was placed on the upper surface of the arm and covered with a cloth. Vibro-tactile stimulation was applied to either one or two tactors in two periods. Subjects identified which period contained two stimuli. A psychometric function was drawn through the probability of correct response as a function of tactor separation to determine the threshold distance. In a separate experiment, subjects estimated the perceived location of each tactor against a scale laid on top of the cloth. The estimated locations of the tactors on the tested arm were displaced by tendon vibration of the holding arm compatible with a perceptual lengthening of the arm. The threshold for two-touch discrimination was significantly increased from 4.5 (±0.6) cm with no tendon stimulation to 5.7 (±0.5) cm when the arm was perceptually extended. We conclude that two-point touch discrimination depends on the size of central receptive fields that become larger when the arm is perceptually lengthened.