The dynamic simulation of mechanical effects has a long history in computer graphics. The classical methods in this field discretize Newton's second law in a variety of Lagrangian or Eulerian ways, and formulate forces appropriate for each mechanical effect: joints for rigid bodies; stretching, shearing or bending for deformable bodies and pressure, or viscosity for fluids, to mention just a few. In the last years, the class of position-based methods has become popular in the graphics community. These kinds of methods are fast, stable and controllable which make them well-suited for use in interactive environments. Position-based methods are not as accurate as force-based methods in general but they provide visual plausibility. Therefore, the main application areas of these approaches are virtual reality, computer games and special effects in movies. This state-of-the-art report covers the large variety of position-based methods that were developed in the field of physically based simulation. We will introduce the concept of position-based dynamics, present dynamic simulation based on shape matching and discuss data-driven upsampling approaches. Furthermore, we will present several applications for these methods.