Some of the best characters are written by authors with good intuition. It’s like the intuition you have about people and your surroundings. Imagine interrupting a board meeting to hand your boss a note inviting him to Happy Hour, and he gives you a cold stare. Now you feel embarrassed and wish you could crawl under a rock. Your intuition should've kicked in to tell you that it’s not a good time to invite your boss to Happy Hour! Writing believable characters is really about you and how you observe people in different situations. The way you interpret others can translate into believable or non-believable characters.
Remember, your characters are real-life people who have been given another name and description. It’s true! Characters are real humans who express genuine emotion. They have habits, hobbies and do strange things sometimes, don’t you? Take a look at the people around you in your everyday life. How do they talk, walk, or respond to certain things? How do they look or smell? What type of clothes are they wearing? Sometimes if a character is complicated, it may require research. For instance, I try to make sure my characters’ personalities fit their career choice or hobbies. With descriptions, I may cut out pictures of people that I feel resemble my characters in order to describe them better. Character interviews are also an exciting way to make them authentic. (See "An Interview with Connie Morris")
Become a “method writer.” Okay, I know you’re wondering what that is. It’s like a method actor who gets into character and plays the role so well that even those close to them believe that what they're doing and saying are real. You may even believe them! Well, when I write, I become my characters. I feel all of their emotions and write their dialogue as if the events were happening to me. I know that if I can make myself feel my characters' emotions then I may help my readers feel the same. So, don’t be afraid to jump inside your characters. Act them out through role-playing.
The bottom line is, the more human your characters are, the better your chance for a great story!