One of the major challenges facing the professionals involved in the home modification process is to succeed in adapting the environments in a way that enables an optimal fit between the individual and the setting in which he or she operates. The challenge originates primarily from the fundamental characteristic of design - one can see and test the final result of home modifications only after they have been completed. The goal of this study was to address this problem by developing and evaluating an interactive living environments model, HabiTest, which will facilitate the planning, design and assessment of optimal home and work settings for people with physical disabilities. This paper describes the HabiTest tool, an interactive model that has been implemented via an immersive virtual reality system which displays three-dimensional renderings of specific environments, and which responds to user-driven manipulations such as navigation within the environment and alteration of its design. Initial results of a usability evaluation of this interactive environment by users are described.