In needle biopsy of the spine, an Augmented Reality (AR) image-guidance system can be very effective in ensuring that while targeting the lesion with the biopsy needle, vital organs near the spine are not damaged and that the approach path is accurate. This procedure requires skill that is hard to master on patients. In this paper, we present a low cost AR based training set-up which consists of a software that uses one static single-camera tracking mechanism to locate the biopsy needle in the patient and which then augments the camera feed of the patient with virtual data providing real-time guidance to the surgeon for insertion of the biopsy needle. The setup is implemented using a phantom model consisting of a set of carefully modeled holes to simulate the needle insertion task. The lack of requirement of elaborate infrared tracking systems and high computing power makes this system very effective for educational and training purposes.