How did they make Cats & Dogs talking realistic?

According to director Lawrence Guterman

A marvelous blend of computer graphics, puppets and real animals were used to reinvent the idea of the Cold War spy thriller.

Behind the scenes, cats and dogs never laid claws on each other. They never had a chance to show any real hostility. Every scene that had cats and dogs were shot keeping them segregated from one another.

To portray Mr. Tinkles, two white Persians (Foster and Fritz) were used, along with a life-sized puppet. There were six puppeteers, who stood under floorboards, inside an underground chamber and in stairs to operate the puppet. This puppet had a computer controlled motors to make Mr Tinkles actions look live.

There were 33 cats and 27 dogs employed in the movie, along with more than a dozen different animatronic puppets and a legion of computer graphics to portray battle and chase scenes without endangering any animal.

Before shooting started, they scanned animals' image. They also put sensors to record body dimensions, facial expressions and movement to allow designers to create an unlimited number of actions and expressions. This also helped creating life-sized puppets.

How different scenes were filmed:

1. Sidekick of Tinkles was filmed with two exotic shorthairs named Edison and Edgar. They were filmed separately.
2. Butch was played by three Anatolian shepherds whereas Lou was played by five pocket beagles.
3. Training of cats and dogs began about a year before filming and they were verbally cued to perform some of the more innocuous behaviours. For instance, open warfare breaks out when an orange tabby cat tries to steal a newspaper. The cat was trained to roll with the paper on cue.
4. The scene where Buddy chases a cat was filmed separately.
5. They used treats to make cats and dogs runs to a certain point. Besides, they also used toys to make them make certain movements.

Source: Pet Place