This paper describes a heterogeneous multi-UAV simulation of the nonlinear, 6-DOF, rigid body dynamics involved in close formation flight. Salient features of our simulation include (i) flexibility in adding/removing UAVs to the existing group, (ii) versatility to handle any formation geometry (V-type, echelon type, etc.), (iii) adaptability to dynamic mission planning, (iv) generic platform to test different control schemes, (v) ability to accomodate UAVs of different airframe configurations and (vi) simplicity in the design. This simulation has been developed primarily for the extensive design, testing and implementation of a nonlinear control law for the station-keeping and reconfiguration of a UAV formation. But the simulation can also be applied, with little modifications, to study the dynamics and control of aircraft in other types of close-proximate flight such as aerial refueling. The simulation has been built in MATLAB/Simulink environment, using a two-level architecture. The outer level contains the formation guidance in the frame of a Virtual Leader (VL) represented by a “VL motion” block and the individual “UAV” blocks along with their corresponding “Reference trajectory” and “Controller” blocks. The inner level comprises of each of the individual “UAV” blocks. Each “UAV” block is treated as a masked subsystem with the individual aircraft parameters and nominal conditions defined in its local workspace. Further, in our simulation structure, transfer of information between subsystems takes place through two separate channels one for the signals that are needed in the individual UAV dynamics and vortex-effect computations and the other for interaircraft communication as a part of coordination and management of the multi-aircraft group. Preliminary simulation results demonstrate successful formation-keeping as well as reconfiguration of a group of six UAVs.