Japanese firm Softbank has unveiled a robot called Pepper, which it says can read human emotions.
It uses an "emotional engine" and a cloud-based artificial intelligence system that allows it to analyse gestures, expressions and voice tones.
The firm said people could communicate with it "just like they would with friends and family" and it could perform various tasks.
It will go on sale to the public next year for 198,000 yen ($1,930; £1,150).
"People describe others as being robots because they have no emotions, no heart," Masayoshi Son, chief executive of Softbank, said at a press conference.
"For the first time in human history, we're giving a robot a heart, emotions."
The firm will deploy prototypes of the robot at two of its stores from Friday, allowing customers to interact with them.
Softbank said it planned to subsequently station Pepper at more of its stores nationwide.
Japan is one of the world's biggest robot markets.
According to some estimates, its overall robotics market was worth about 860bn ($8.4bn; £5bn) yen in 2012.
And with a rapidly ageing population, coupled with a falling birth rate, the demand for robots is expected to increase further.
The growth is expected to come not only from businesses looking to offset labour shortages and rising wage costs, but also from households seeking an alternative to paying for care workers for elderly relatives.
Japanese carmaker Honda has also been developing a household robot, Asimo. US President Barack Obama played football with it during his recent visit to Japan.
ActiveLink, a robotics research subsidiary of electronics firm Panasonichas also developed technology to help people carry out manual tasks.
Analysts said that development of household robots was likely to pick up, especially in countries like Japan that have an ageing population.
"Even if one can pre-programme such robots to carry out specific tasks based on certain commands or gestures, it could go long way in helping improve elderly care," said Rhenu Bhuller, senior vice president healthcare at consulting firm Frost & Sullivan.
"And with the technology improving fast - you could see big improvements in managing labour requirement in the the sector."
Softbank developed Pepper in collaboration with French company Aldebaran Robotics, in which it took a majority stake in 2012.
Bruno Maisonnier, founder and chief executive of Aldebaran said: "The emotional robot will create a new dimension in our lives and new ways of interacting with technology."
"It's just the beginning, but already a promising reality."