Elastic and Viscoelastic moduli, yielding and failure of ternary composites of thermoplastic matrix filled with particulate fillers and elastomer inclusions are discussed. Modeling of the role of elastomer interphase in elastic response and in failure processes, based on the combination of numerical method (Finite Element Analysis) and percolation concept, is presented for PP/EPR/filler systems. Proposed expressions for Young modulus, yield strength and critical strain energy release rate are used to predict the lower and upper limiting Values of these properties in the case of the two limiting morphologies. Good agreement is found between theoretical predictions and experimental data.