Do not confuse this animation with stop animation. Model animation is a form of the stop motion animation but it is designed to merge in with the live action footage to make an illusion of a real world sequence. Andthe best ones out there are?
King Kong 1933
It is a pretty well known fact that many directors including Peter Jackson got into the industry because of this film. The model from this film is one of the most famous because the model is worth so much money. It was actually inducted into the United States National Film Registry.
Song of Kong 1933
This one was the direct sequel to the movie and it was released in the same year, amazingly. It would certainly be impossible to do that now, the creators knew the film wouldnt be as good as the first so they turned up the comedy for the second one. It was a success without a doubt and it was combination of both of these films that inspired the 22 Godzilla films.
James and the Giant Peach
it is pretty obvious to say that this film was based on the book by Dahl. This movie was directed by Henry Selick and produced by Tim Burton, it was Burton who came up with the entire idea but was tied down by Batman. This film really shows off the power of model animation and just how it can work seamlessly with real life actors. Although this film did seem to have a great number of good reviews it never made a profit.
Bonus Entry
The Nightmare Before Christmas
This one is stop motion which is why it is not included on the main list but I had to include it because in my opinion it is the best stop motion movie of all time and it made around $50 million on its first run and made even more the second time it was released under the Disney name this time rather than the Disney owned touchstone.
For real models check out plastic model kits and for a bit of fun look into RC cars or RC aircraft.