To gain insight in relationships among capillary pressure, interfacial area, saturation, and relative permeability in two-phase flow in porous media, we have developed two types of pore-network models. The first one, called tube model, has only one element type, namely pore throats. The second one is a sphere-and-tube model with both pore bodies and pore throats. We have shown that the two models produce distinctly different curves for capillary pressure and relative permeability. In particular, we find that the tube model cannot reproduce hysteresis. We have investigated some basic issues such as effect of network size, network dimension, and different trapping assumptions in the two networks. We have also obtained curves of fluid–fluid interfacial area versus saturation. We show that the trend of relationship between interfacial area and saturation is largely influenced by trapping assumptions. Through simulating primary and scanning drainage and imbibition cycles, we have generated two surfaces fitted to capillary pressure, saturation, and interfacial area (Pc–Sw–anw) points as well as to relative permeability, saturation, and interfacial area (kr–Sw–anw) points. The two fitted three-dimensional surfaces show very good correlation with the data points. We have fitted two different surfaces to Pc–Sw–anw points for drainage and imbibition separately. The two surfaces do not completely coincide. But, their mean absolute difference decreases with increasing overlap in the statistical distributions of pore bodies and pore throats. We have shown that interfacial area can be considered as an essential variable for diminishing or eliminating the hysteresis observed in capillary pressure–saturation (Pc–Sw) and the relative permeability–saturation (kr–Sw) curves.