At present the commercially available rapid prototyping (RP) machines can mainly produce parts that can be used either as models for visualization or for rapid tooling. The emphasis of the on going research in this field is to produce parts that can physically imitate and work like a component produced by a conventional manufacturing technique. Thus the idea is to produce “form-fit-functional” parts rather than prototypes for visualization. Parts made by metals are of specific interest and welding based RP has good prospects in this regard; with the specific possibility to produce fully dense metallic parts and tools. However, the big draw back of using welding as the deposition process is the large heat input to the substrate or to the previously deposited layers, thus causing high temperature gradients and resulting in deformations, warpage, residual stresses, delamination and poor surface quality. In addition the layer by layer additive manufacturing nature results in non-homogeneous structures, porosity and anisotropic material properties. Parts thus produced are of near net shape and out of tolerance. In order to predict and minimize these problems, knowledge of thermal gradients and temperature history during manufacture is important. Moreover, to overcome the problem of surface quality and out of tolerance parts a hybrid welding/CNC milling based RP system can be a good option. These problems associated with the use of welding as RP tool needs to be minimized by the proper investigation of the different deposition parameters and process conditions e.g. intermediate machining, deposition patterns, heat sink size, interpass cooling time, preheating and constant control temperatures on the material properties and mechanical behaviors of the finally produced parts. This dissertation presents an analysis based on a numerical and experimental approach for the effects of different deposition and process parameters on welding based rapid prototyping process. The entire work is divided into two main parts. The first part is an experimental comparison of microstructure and material properties of the simple GMAW based layered manufacturing (LM) with the hybrid vwelding/milling based LM process. Material properties were investigated both on a macro and microscopic level. The microstructure for the two deposition procedures were studied and compared. The hardness test results for the two procedures were investigated and the results were studied in the light of the respective microstructures. Tensile test samples were developed and testing was performed to investigate the directional properties in the deposited materials. Reaustenitised and un-reaustenitised regions were found in the entire body of deposition without machining (DWM) while these are confined to the top layer of deposition with intermediate machining (DWIM) changing alternatively across the weld direction with intervals equal to the inter-bead spacing. The central layers of the DWIM deposit comprise only of reaustenitised region varying sequentially in grain size in both longitudinal and perpendicular direction. This sequential variation is in accordance with the inter-bead spacing in the across direction, and with the layer thickness in the perpendicular direction. The hardness results are in good agreement with the variation of the microstructure both for DWIM and DWM. The hardness values are higher at the top and interface layer while it is comparatively less in the central layers of DWIM samples. However, in DWM samples the hardness values are relatively higher in the top layer only. The correlation for hardness values as related to the tensile strength also holds within normal expectations. The tensile test results show no variation in the yield strengths of samples produced longitudinal and perpendicular to the deposition direction; however there is a slight difference in elongation. Moreover a sharp yield point was observed in the DWIM samples in contrast to the DWM samples. The second part presents a finite element (FE) based 3D analysis to study the thermal and structural effects of different deposition parameters and deposition patterns in welding based LM. A commercial finite element software ANSYS is coupled with a user programmed subroutine to implement the welding parameters like Goldak double ellipsoidal heat source, material addition, temperature dependent material properties. The effects of interpass cooling duration were studied and it was found that an intermediate value of interpass time is suitable for a nominal level of deformations and stresses. A similar finding was made from the studies about different weld bead starting temperatures. The studies regarding different boundary conditions revealed that the deformations are least for adiabatic case while isothermal case produced the maximum deformations. Simulations carried out with various deposition sequences virevealed that the thermal and structural effects, on the work piece, are different for different deposition patterns. The sequence starting from outside and ending at the center is identified as the one which produces minimum warpage. The results presented are for deposition by gas metal arc welding but can be applied to other deposition process employing moving heat source. The parametric results suggest that in order to minimize the harmful effect of residual stresses, proper combination of deposition parameters is essential. Proper selection of deposition patterns, substrate thermal insulation, and nominal interpass cooling / control temperature can reduce the part warpage due to residual stresses.