In 2015 the first observation of gravitational waves marked a breakthrough in astrophysics, and in technological research and development. The discovery of a gravitational-wave signal from the collision of two black holes, a billion light-years away, received considerable interest from the media and public. We describe the development of a purpose-built exhibit explaining this new area of research to a general audience. The core element of the exhibit is a working Michelson interferometer: a scaled-down version of the key technology used in gravitational-wave detectors. The Michelson interferometer is integrated into a hands-on exhibit, which allows for user interaction and simulated gravitational-wave observations. An interactive display provides a self-guided explanation of gravitational-wave-related topics through video, animation, images and text. We detail the hardware and software used to create the exhibit and discuss two installation variants: an independent learning experience in a museum setting (the Thinktank Birmingham Science Museum), and a science-festival with the presence of expert guides (the 2017 Royal Society Summer Science Exhibition). We assess audience reception in these two settings, describe the improvements we have made given this information, and discuss future public-engagement projects resulting from this work. The exhibit is found to be effective in communicating the new and unfamiliar field of gravitational-wave research to general audiences. An accompanying website provides parts lists and information for others to build their own version of this exhibit.