Instead of caging animals like it is done in traditional zoos, we try to cage their realities instead. They will be controlled by using augmented reality gadgets. These gadgets will give them sensory feeds that keep them in line and protect humans from the animals and protect animals from each other.
A similar idea has been implemented on a different scale in the case of dogs that are given orders by military personnel at a safe distance from the scene of action. The AR technology used in the mentioned case will have to be improved to the extent that they provide olfactory sensations too (they would have to create artificial smells) for them to be usable for this idea.
The AR will be set to give the animals an experience that is very close to their natural habitats. It will also restrict their movement and behavior using virtual barriers that the animal will naturally avoid. For example, they can be kept from crossing a particular territory by placing a virtual moat, rock, or large trees. Human figures can also be added to their virtual realities to systematically tame them so that they would not attack humans if the AR gadgets are turned off.
With such a system in place people who visit the zoo can enter the environment and go close to the animals while being sure that the animals can not see or harm them. If the setup is successful we can have humans and tamed animals living together; our own artificial garden of Eden. Wild animals can also be domesticated without having to put them in cages.
Another advantage of this system is that research on animal behavior and crossbreeding experiments can be more controlled from the animal's point of view while they will feel natural to the animals being controlled.
One of the major challenges of this idea is the cost of implementation since every animal that can attack other animals or humans will have a set of AR gadgets. A lot of money will have to go into the area of research on AR gadgets for animals since it is a field that has barely been explored. To make things more difficult; the AR gadgets will have to be designed differently for most species.