Anyone can create a character. But it takes skill and talent to truly bring a character to life when that character exists only on the pages of a book. Characterization is really an artistic representation of human character and motives. Think about this definition for a moment. Let it sink in and not the last word -- motives. But this definition only tells you what you are meant to achieve. How do you achieve this?
Start With Feeling
We all feel the same basic emotions. How we express these emotions differs greatly, but the emotions themselves remain the same. When you first create your character, forget about expressing for a while. Think instead about the emotions that make up your character. Is your character lonely? Loneliness is an emotion. Content? Depressed? Whatever. Decide how your character generally feels and make sure you understand why. If he's lonely, there had better be a reason.
Once you understand the general emotions your character lives with every day, think of how these emotions express themselves in specific situations. Does your character avoid people? Maybe they get angry when not invited to something, but since they're naturally anti-social, they never go to anything anyway. Maybe your character is a chauvinist at heart and just a little domineering. Maybe this causes him to freak out when confronted with a woman who doesn't bend to his wishes (I have a character like this, though he's trying to mellow out).
How your character reacts to any given situation is a combination of his emotions and his experiences. Make sure you understand both before you truly try to make your characters come to life.
Dress and Location
We judge people by appearance and location. To say we don't is a lie. We define people by who they associate with, what they look like, and where they like to hang out. Use this to truly bring life to your character. Does he wear his pants so loose they almost fall off? If so, your readers will assume certain things about him without you ever having to be specific.
These assumptions are helpful, either because they help establish character or because they allow you to confound expectations. Maybe the teen with his pants down around his ankles really is a bum, but maybe he's truly brilliant and has great plans for his future. Either way, you'll have something by which you can bring further life to your characters.
This same idea applies to the friends your characters choose and the locations they inhabit. Think about it carefully. Have you ever thought you might like someone, then discovered they were friends with (or married to) someone you despised? That usually affects how you feel about the person in question. The same goes for places. So bear this in mind when choosing the settings and supporting characters for your novel.
Everyone Has a Motive
Anytime I talk about character development, regardless of the particular point of the article, I have to eventually talk about motive. Motive will make or break your characters, but it's more important than that. Motive, or lack of it, can make or break your entire story. It's really that important.
Motive must be utmost in your mind when crafting your story. You might have a wonderful plot, but if you want a believable story, you're going to have to make sure your readers can understand the motives behind each and every thing your characters do. You need your main character on the other side of the country? Why is he going there? Don't try to convince your reader that he just randomly decided to fly across the country for no reason. No one will buy it. But maybe he's going to visit his aging mother. Or maybe his girlfriend has run back home and he wants to make an attempt at setting things right.
If your characters are fully realized people, they have feelings and motives. Their style of dress and the people they hang out with will say something about them. Make use of these tools in your quest for characterization.