Facial emotional expressions are crucial in face-to-face social interactions, and recent findings have highlighted their interactive nature. However, the underlying neural mechanisms remain unclear. This electroencephalography study investigated whether the interactive exchange of facial expressions modulates socio-emotional processing. Participants (N = 41) displayed a facial emotional expression (angry, neutral, or happy) toward a virtual agent, and the agent then responded with a further emotional expression (angry or happy) or remained neutral (control condition). We assessed subjective experience (valence, arousal), facial EMG (Zygomaticus, Corrugator), and event-related potentials (EPN, LPP) elicited by the agent’s response. Replicating previous findings, we found that an agent’s happy facial expression was experienced as more pleasant and elicited increased Zygomaticus activity when participants had initiated the interaction with a happy compared to an angry expression. At the neural level, angry expressions resulted in a greater LPP than happy expressions, but only when participants directed an angry or happy, but not a neutral, expression at the agent. These findings suggest that sending an emotional expression increases salience and enhances the processing of received emotional expressions, indicating that an interactive setting alters brain responses to social stimuli.