An interactive system is described for creating and animating deformable 3D characters. By using a hybrid layered model of kinematic and physics-based components together with an immersive 3D direct manipulation interface, it is possible to quickly construct characters that deform naturally when animated and whose behavior can be controlled interactively using intuitive parameters. In this layered construction technique, called the elastic surface layer model, a simulated elastically deformable skin surface is wrapped around a kinematic articulated figure. Unlike previous layered models, the skin is free to slide along the underlying surface layers constrained by geometric constraints which push the surface out and spring forces which pull the surface in to the underlying layers. By tuning the parameters of the physics-based model, a variety of surface shapes and behaviors can be obtained such as more realistic-looking skin deformation at the joints, skin sliding over muscles, and dy...