We present TexelBlocks, modular blocks that dynamically change their surfaces to support rich physical interactions. The core component of each block is a motorized crawler belt with a set of material patches attached to it, allowing each of the TexelBlocks to change their surface independently and be concatenated into flat surfaces of various sizes. We implemented a working system that controls 24 TexelBlocks to form 6 × 4 dynamic surfaces. With the working prototype, we developed five applications such as context-aware surface adaptation, real-time tactile feedback, immersive storytelling with dynamic background, real-time embodied platform game, and a surface-changing board game to demonstrate rich physical interactions of dynamic surfaces.