Multimodal language models (MLLMs) exhibit promising spatial reasoning capabilities, yet the internal mechanisms supporting them remain poorly understood.
We uncover S-Space, a linear representation subspace in which object-token representations encode continuous coordinates along horizontal, vertical, and distance axes.
Although we identify these axes by differentiating spatial-answer scores with respect to object-token activations, S-Space is intrinsic rather than induced by specific data or prompts, remaining readable under non-spatial questions.
We show that S-Space functions as an internal spatial workspace of MLLMs.
Perception encodes object locations into it, forming spatial representations that can be directly read out to support accurate spatial judgments.
Internal reasoning transforms it for changing viewpoints.
Verbal responses selectively access it, evidenced by causal interventions that alter spatial judgments while largely preserving non-spatial responses.
Case studies further show that S-Space assigns locations to unseen entities and the observer, and connects physical directions with abstract linguistic meanings, suggesting both the capabilities and limitations of large-scale language training.
Finally, we use S-Space as a diagnostic tool for spatial reasoning failures. Direction-word readouts reveal systematic coupling between cardinal and image-relative reference frames.
More importantly, a perception-computation decomposition exposes a key bottleneck: MLLMs can form capable spatial representations, yet fall short in the spatial transformations required to reason reliably across viewpoint changes.
