This paper introduces the EMU, a three-dimensional robotic manipulandum for rehabilitation of the upper extremity for patients with neurological injury. The device has been designed to be highly transparent, have a large workspace, and allow the use of the hand for interaction with real-world objects to provide additional contextual cues during exercises. The transparency is achieved through the use of a capstan transmission for the drive joints; a hybrid serial parallel kinematics minimising moving inertia; and lightweight materials. An experimental protocol is reported here which demonstrates the transparency through a comparison to out-of-robot movements, and with an existing rehabilitation robotic device. Additionally, an adjustable gravity compensation method is constructed, which minimises the torque required at the shoulder to carry the subject's arm. These characteristics allow the EMU to serve as a multi-purpose platform for the further development of novel robot assisted rehabilitation strategies.