Existing work on applications for thin watery paint is mostly focused on automatic generation of painterly-style images from input images, ignoring the fact that painting is a process that intuitively should be interactive. Efforts to create real-time interactive systems are limited to a single paint medium and results often suffer from a trade-off between real-timeness and simulation complexity. We report on the design of a new system that allows the real-time, interactive creation of images with thin watery paint. We mainly target the simulation of watercolor, but the system is also capable of simulating gouache and Oriental black ink. The motion of paint is governed by both physically based and heuristic rules in a layered canvas design. A final image is rendered by optically composing the layers using the Kubelka–Munk diffuse reflectance model. All algorithms that participate in the dynamics phase and the rendering phase of the simulation are implemented on graphics hardware. Images made with the system contain the typical effects that can be recognized in images produced with real thin paint, like the dark-edge effect, watercolor glazing, wet-on-wet painting and the use of different pigment types. Copyright © 2005 John Wiley & Sons, Ltd.