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The semantics of simple (i.e. two-term) systems of demonstratives have in general hitherto been treated as inherently spatial and as marking a symmetrical opposition of distance (‘proximal’ versus 'distal'), assuming the speaker as a point of origin. More complex systems are known to add further distinctions, such as visibility or elevation, but are assumed to build on basic distinctions of distance. Despite their inherently context-dependent nature, little previous work has based the analysis of demonstratives on evidence of their use in real interactional situations. In this article, video recordings of spontaneous interaction among speakers of Lao (Southwestern Tai, Laos) are examined in an analysis of the two Lao demonstrative determiners nii 4 and nan 4 . A hypothesis of minimal encoded semantics is tested against rich contextual information, and the hypothesis is shown to be consistent with the data. Encoded conventional meanings must be kept distinct from contingent contextual information and context-dependent pragmatic implicatures. Based on examples of the two Lao demonstrative determiners in exophoric uses, the following claims are made. The term nii 4 is a semantically general demonstrative, lacking specification of any spatial property (such as location or distance). The term nan 4 specifies that the referent is 'not here' (encoding ‘location’ but not 'distance'). Anchoring the semantic specification in a deictic primitive 'here' allows a strictly discrete intensional distinction to be mapped onto an extensional range of endless elasticity. A common ‘proximal’ spatial interpretation for the semantically more general term nii 4 arises from the paradigmatic opposition of the two demonstrative determiners. This kind of analysis suggests a reappraisal of our general understanding of the semantics of demonstrative systems universally. To investigate the question in sufficient detail, however, rich contextual data (preferably collected on video) is necessary.