The effects of steric obstruction and cyclization in polymer network formation were modelled by using a Monte-Carlo simulation technique applied to systems composed of up to 10⁹ monomer units. The network formation process was described by Smoluchowski coagulation equations containing intermolecular and intramolecular terms. Various functional forms of the number of unreacted functional groups were ascribed to the kernels of these equations. The steric obstruction was modelled by introducing an effective reactive surface which is a measure of the variation of reactivities of functional groups when passing from the surface to the centre of the molecule. Several variants of cyclization models were examined. A physically reasonable assumption was adopted in which the chance for a group to close an intramolecular bond depends on the neighbouring groups only up to a certain distance. When the obstructions and cyclization become stronger, the gel point is shifted to higher conversions or gelation does not occur at all. Also the steepness of the sol-gel transition depends on the strength of obstruction and cyclization.