When a standing person applies a light finger touch to an external stable object, postural sway is reduced. We tested a hypothesis that two factors related to touch can induce this effect, the presence of a stable reference point and the modulation of contact forces leading to tissue deformation. Force platform signals were analyzed while subjects stood quietly with or without additional light touch to an external object (contact forces under 1 N). The point of touch on the body was manipulated. We also investigated the effects of active touch vs fixation of a finger at a point in external space. The results show that touch to the head or neck can be more effective in reducing body sway than a finger touch. A larger reduction in sway was observed when the finger was fixed in a clip (the net forces between the clip and the point of its fixation to the stand were under 1 N) as compared to a free light touch to a pad. The subjects showed a reduction in postural sway while holding a load suspended using a pulley system; in this situation, contact with the load via the pulley provided modulation of contact forces but not a fixed reference point. This finding emphasizes the importance of such factors as stability of the contact point and modulation of contact forces, as compared to active touch or to an implicit task of stabilizing the kinematic chain. The system of postural stabilization can reduce postural sway, making use of either of two sources of sensory information associated with touch, one related to providing a fixed reference point in space, and the other related to transient force changes at the point of contact related to the sway.