While developing characters is one of the most important aspects of creating a story, it is one of the most complicated for me.
I have heard of various methods for creating characters including character questionnaires and interviews, emulating people you already know and giving them their own unique identity, role-playing and acting out as your characters to get a "feel" for their behaviors, and other exercises designed to get one to think about their characters and who they will be.
How do you create your characters?