Background: Education is, after gaming, the second largest sector embracing augmented reality (AR) at an accelerated pace, yet studies on AR's potential as an efficient learning environment had mixed results. Objectives: This study's primary objective is to test students' interaction with graphical 3D elements in AR and its impact on information retention. The second objective is to compare information retention from AR engagement with information retention from exposure to identical 3D content delivered via instructional video. Finally, the third objective explores students' perceptions of AR as a learning environment. Methods: Sixty-five college students participated in a two-arm experiment followed by semi-structured interviews. Results and Conclusion: AR can efficiently deliver a meaningful learning experience and promotes information retention. Nevertheless, AR's interactive features and novelty may distract learners while they engage with the virtual environment. Objective data obtained through eye tracking and video monitoring showed similar levels of engagement with a 3D model for both environments. While both AR and video groups showed significant knowledge gain from pre to post-intervention, the video format was overall significantly more effective than AR in increasing topic-related information retention. However, participants preferred the AR learning environment significantly more than the video. Takeaways: Although effective, AR is still a distracting instructional environment. Designing learning experiences tailored explicitly for AR environments requires additional research to ensure its successful deployment as a learning tool.