In many applications envisioned for wireless sensors, physical variables governed by continuous, distributed dynamics need to be monitored and controlled. Spatial and temporal irregularities in sampling available from the wireless nodes are usually inconsistent with the application requirements. In this paper we propose virtual sensor-actuator arrays to address this problem and consider the problem of estimating values of physical variables at points other than the wireless node locations. We use reduced-order models of the physical dynamics to generate these estimates. Model parameters are estimated using parametric system identification techniques. The concepts are illustrated for the problem of estimating temperatures based on circuit models of thermal dynamics. Results are presented from experiments using actual data collected by a wireless sensor network.