Two nonlinear interfacial elasticity models-interfacial elasticity decreasing linearly and exponentially with area fraction-are developed for the encapsulation of contrast microbubbles. The strain softening (decreasing elasticity) results from the decreasing association between the constitutive molecules of the encapsulation. The models are used to find the characteristic properties (surface tension, interfacial elasticity, interfacial viscosity and nonlinear elasticity parameters) for a commercial contrast agent. Properties are found using the ultrasound attenuation measured through a suspension of contrast agent. Dynamics of the resulting models are simulated, compared with other existing models and discussed. Imposing non-negativity on the effective surface tension (the encapsulation experiences no net compressive stress) shows "compression-only" behavior. The exponential and the quadratic (linearly varying elasticity) models result in similar behaviors. The validity of the models is investigated by comparing their predictions of the scattered nonlinear response for the contrast agent at higher excitations against experimental measurement. All models predict well the scattered fundamental response. The nonlinear strain softening included in the proposed elastic models of the encapsulation improves their ability to predict subharmonic response. They predict the threshold excitation for the initiation of subharmonic response and its subsequent saturation. © 2010 Acoustical Society of America.