We theoretically investigate the feasibility and potential performance of optically and electrically pumped vertical-cavity surface-emitting lasers (VCSEL's) emitting in the mid-IR spectral region, Our model includes spontaneous, stimulated, and nonradiative recombination, numerical dispersion relations and optical matrix elements from a multiband finite-element algorithm, carrier and lattice heating, three-dimensional heat flow, electrical injection, photon propagation, and diffraction, Each modeled structure consists of a distributed Bragg reflector (DBR) semiconductor bottom mirror, a lambda, 2 lambda, or 3 lambda optical cavity incorporating the type-II active region, a dielectric top mirror through which the output is emitted. The optically pumped VCSEL structure with a 10-mu m-diameter spot is predicted to operate up to a heat-sink temperature of 250 K and to be capable of producing >2 mW of CW output power, Furthermore, by collimating the pump beam with a microlens array, gain-guided VCSEL arrays with output powers in the watt range should be attainable, Comparable powers and operating temperatures are predicted for patterned devices with electrical injection through annular contacts, By far the most attractive properties are expected for structures employing a type-II interband cascade active region with electron recycling. The simulation predicts single-element threshold currents of 150 mu A at 200 K and 1.1 mA at 300 K and CW output powers of 4.7 and 1.2 mW, respectively.