This is an informed assessment of the state of the art and an extensive inventory of modeling approaches and methods for soft tissue/medical cutting tool interaction and of the associated medical processes and phenomena. Modeling and simulation through numerical, theoretical, computational, experimental, and other methods was discussed in comprehensive review sections each of which is concluded with a plausible prospective discussion biased toward the development of so-called virtual reality (VR) simulator environments. The finalized prospective section reflects on the future demands in the area of soft tissue cutting modeling and simulation mostly from a conceptual angle with emphasis on VR development requirements including real-time VR simulator response, cost-effective “close-to-reality” VR implementations, and other demands. The review sections that serve as the basis for the suggested prospective needs are categorized based on: (1) Major VR simulator applications including virtual surgery education, training, operation planning, intraoperative simulation, image-guided surgery, etc. and VR simulator types, e.g., generic, patient-specific and surgery-specific and (2) Available numerical, theoretical, and computational methods in terms of robustness, time effectiveness, computational cost, error control, and accuracy of modeling of certain types of virtual surgical interventions and their experimental validation, geared toward ethically driven artificial “phantom” tissue-based approaches. Digital data processing methods used in modeling of various feedback modalities in VR environments are also discussed.