Fictional characters (FCs) and mediated persons in literature, theater, film, art, TV, and digital media fulfill basic psychological functions, although the processes involved remain unspecified. Departing from identification and empathy hypotheses, a new context‐sensitive model draws upon similarity studies, empirical aesthetics, persuasion, emotion, and social psychology. The Perceiving and Experiencing Fictional Characters model (PEFiC‐model) has three phases. During encoding, observers judge FCs in terms of ethics (good‐bad), aesthetics (beautiful‐ugly), and epistemics (realistic‐unrealistic). Comparison entails appraisals of personal relevance as well as valence towards and (dis)similarity between the dramatis personae and the self. In the response phase, appreciation of FCs is a trade‐off between the parallel, unipolar processes of involvement and distance. Intricate involvement‐distance conflicts occur when subjective norms disagree with ingroup norms. Furthermore, features participate in multiple (fuzzy) sets (e.g., partly good and partly bad). PEFiC can handle complex responses towards representations of (non‐existent) others, such as attractive dissimilarity, the beauty in ugliness, the appeal of negative experiences, and fascination for evil, as well as mixed emotions, ambivalence, and neutral end‐states that actually conceal emotional confusion.