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Over the past two decades most discussions of the simulation of miscible displacement in porous media were related to incompressible flow problems; recently, however, attention has shifted to compressible problems. The first goal of this paper is the derivation of the governing equations (mathematical models) for a hierarchy of miscible isothermal displacements in porous media, starting from a very general single-phase, multicomponent, compressible flow problem; these models are then compared with previously proposed models. Next, we formulate an extension of the modified method of characteristics with adjusted advection to treat the transport and dispersion of the components of the miscible fluid; the fluid displacement must be coupled in a two-stage operator-splitting procedure with a pressure equation to define the Darcy velocity field required for transport and dispersion, with the outer stage incorporating an implicit solution of the nonlinear parabolic pressure equation and an inner stage for transport and diffussion in which the mass fraction equations are solved sequentially by first applying a globally conservative Eulerian–Lagrangian scheme to solve for transport, followed by a standard implicit procedure for including the diffusive effects. The third objective is a careful investigation of the underlying physics in compressible displacements in porous media through several high resolution numerical experiments. We consider real binary gas mixtures, with realistic thermodynamic correlations, in homogeneous and heterogeneous formations.