Imitation learning is considered to be an effective way of teaching humanoid robots and action recognition is the key step to imitation learning. In this paper  an online algorithm to recognize parametric actions with object context is presented. Objects are key instruments in understanding an action when there is uncertainty. Ambiguities arising in similar actions can be resolved with object context. We classify actions according to the changes they make to the object space. Actions that produce the same state change in the object movement space are classified to belong to the same class. This allow us to define several classes of actions where members of each class are connected with a semantic interpretation.