Perceiving the sensory consequences of action accurately is essential for appropriate interaction with our physical and social environments. Prediction mechanisms are considered necessary for fine-tuned sensory control of action, yet paradoxically may distort perception. Here, we examine this paradox by addressing how movement influences the perceived duration of sensory outcomes congruent with action. Experiment 1 required participants to make judgments about the duration of vibrations applied to a moving or stationary finger. In Experiments 2 and 3, participants judged observed finger movements that were congruent or incongruent with their own actions. In all experiments, target events were perceived to be longer when congruent with movement. Interestingly, this temporal dilation did not differ as a function of stimulus perspective (1st or 3rd person) or spatial location. We propose that this bias may reflect the operation of an adaptive mechanism for sensorimotor selection and control that preactivates anticipated outcomes of action. The bias itself may have surprising implications for both action control and perception of others: we may be in contact with grasped objects for less time than we realize, and others' reactions to us may be briefer than we believe.