This study evaluated the kinematic validity of Microsoft Kinect skeletal tracking for use with an upper limb virtual reality rehabilitation system. We determined the extent to which Kinect tracking of hand position, elbow angle, and trunk position matched that recorded by a motion tracking system over a range of Kinect camera positions. The optimal Kinect camera position was between 1.45m and 1.75m from the user at 0.15m left or right. Tracking error of the Kinect should be considered when the system is used in the clinical setting.