Most of the state‐of‐the‐art optical see‐though head‐mounted displays lack the ability to occlude the real scene and fail to render the virtual scene in high contrast with bright surroundings. Mutual occlusion is a strong contributor to the human visual system's ability to distinguish depth information and create a seamless integration of the real and virtual world. In this paper, we present a monocular prototype of an occlusion‐capable optical see‐through head mounted display and demonstrate its mutual occlusion capability and performance in bright environments. Our design currently uses an Organic LED (OLED) microdisplay coupled with a Liquid crystal on silicon (LCoS) type Spatial Light Modulator (SLM) to achieve a 30 degree diagonal FOV and 1920x1080 color resolution.