Abstract Measuring similarity between nodes has been an issue of extensive research in the social network analysis literature. In this paper, we construct a new measure of similarity between nodes based on the game-theoretic interaction index (Grabisch and Roubens, 1997). Despite the fact that, in general, this index is computationally challenging, we show that in our network application it can be computed in polynomial time. We test our measure on two important problems, namely link prediction and community detection, given several real-life networks. We show that, for the majority of those networks, our measure outperforms other local similarity measures from the literature.