In this paper, we introduce the semantic network model (SNM), a generalization of the hidden Markov model (HMM) that uses factorization of state transition probabilities to reduce training requirements, increase the efficiency of gesture recognition and on-line learning, and allow more precision in gesture modeling. We demonstrate the advantages both formally and experimentally, using examples such as full-body multimodal gesture recognition via optical motion capture and a pressure sensitive floor, as well as mouse / pen gesture recognition. Our results show that our algorithm performs much better than the traditional approach in situations where training samples are limited and/or the precision of the gesture model is high.