The visual analysis of human manipulation actions is of interest for e.g. human-robot interaction applications where a robot learns how to perform a task by watching a human. In this paper, a method for classifying manipulation actions in the context of the objects manipulated, and classifying objects in the context of the actions used to manipulate them is presented. Hand and object features are extracted from the video sequence using a segmentation based approach. A shape based representation is used for both the hand and the object. Experiments show this representation suitable for representing generic shape classes. The action-object correlation over time is then modeled using conditional random fields. Experimental comparison show great improvement in classification rate when the action-object correlation is taken into account, compared to separate classification of manipulation actions and manipulated objects.