We analyze a phase-field approximation of a sharp-interface model for twophase materials proposed by M.Šilhavý [32,33]. The distinguishing trait of the model resides in the fact that the interfacial term is Eulerian in nature, for it is defined on the deformed configuration. We discuss a functional frame allowing for existence of phasefield minimizers and Γ-convergence to the sharp-interface limit. As a by-product, we provide additional detail on the admissible sharp-interface configurations with respect to the analysis in [32,33].By checking the Γ-convergence of F ε to F 0 we essentially deliver a version of the Modica-Mortola Theorem [24] in the deformed configuration. Instrumental to this is the discussion of the interplay of deformations and perimeters in deformed configurations, which constitutes the main technical contribution of our paper (Theorem 2.2).Let us mention that variational formulations featuring both Lagrangian and Eulerian terms are currently attracting increasing attention. A prominent case is that of magnetoelastic materials [16], where Lagrangian mechanical terms and Eulerian magnetic effects combine [6,7,23,29]. Mixed Lagrangian-Eulerian formulations arise in the modeling of nematic polymers [5,6], where the Eulerian variable is the nematic director orientation, and in piezoelectrics [28], involving the Eulerian polarization instead. An interplay of Lagrangian and Eulerian effects occurs already in case of space dependent forcings, like