Sculpting with clay – what is and is not permissible
Question

                I am an artist. Recently I became inclined to sculpturing from mud. I heard that it is haram. But I make it as a flattened drawing, just like a drawn picture. I would like also to know if engraving masjids and houses is as haram as engraving humans and birds?.
Praise be to Allah.Sculpting with clay is one 
    of the kinds of image-making, some of which is permissible and some is 
    haraam. That which is haraam is that which shows images of animate beings, 
    both humans and animals, because of the words of the Prophet  (peace and 
    blessings of Allaah be upon him) which were narrated by Ibn ‘Abbaas, who 
    said: I heard Muhammad  (peace and blessings of Allaah be upon him) say: 
    “Whoever makes an image in this world will be commanded to breathe the soul 
    into it on the Day of Resurrection, and he will not be able to do that.” 
    Narrated by al-Bukhaari (2112) and Muslim (2110). 
As for that which is 
    permissible, it is images of anything that does not have a soul, so it is 
    permissible to sculpt images in clay of mosques, houses, trees and other 
    inanimate objects. 
The scholars of the 
    Standing Committee said:  
The focus of the 
    prohibition on image making is images of animate beings, whether they are 
    sculpted or drawn on walls or fabric or paper, or they are woven, and 
    whether they are drawn with a quill or pen or made with a machine, and 
    whether the image is of the creature as it naturally appears or whether 
    imagination comes into play and it is made smaller or larger, or made 
    beautiful or distorted, or the skeleton inside is shown in the picture.   
The reason for the 
    prohibition is that what is represented is animate beings, even if they are 
    imaginary images such as those that are drawn to represent ancient peoples 
    such as the pharaohs and commanders and soldiers during the Crusades, or 
    images of Jesus and Mary that are placed in churches, etc. This is because 
    of the general meaning of the texts and because of the imitation of the 
    creation of Allaah, and because it is a means that leads to shirk. 
Shaykh ‘Abd al-‘Azeez ibn 
    Baaz, Shaykh ‘Abd al-Razzaaq ‘Afeefi, Shaykh ‘Abd-Allaah ibn Ghadyaan, 
    Shaykh ‘Abd-Allaah ibn Qa’ood. 
Fataawa al-Lajnah 
    al-Daa’imah (1/696) 
It is also not permissible 
    to do sculptures with clay for places of bid’ah which people venerate 
    inappropriately, such as places of worship and graves, and places of sin 
    such as banks and theatres. 
The scholars of the 
    Standing Committee said: It is not permissible to make artistic 
    three-dimensional images of the two Sanctuaries (Makkah and Madeenah) 
    because they may include images of the people in the Haram in Makkah who are 
    doing tawaaf and praying, and of the Qur’aan-reciters and others in 
    al-Masjid al-Nabawi and so on, and because there is a green dome which would 
    be represented in such images of al-Masjid al-Nabawi, and that may lead some 
    people to believe in domes and venerate them and the people buried beneath 
    them, which may lead to major shirk and other evils from which we seek 
    refuge with Allaah. 
Shaykh ‘Abd al-‘Azeez ibn 
    Baaz, Shaykh ‘Abd al-Razzaaq ‘Afeefi, Shaykh ‘Abd-Allaah ibn Ghadyaan, 
    Shaykh ‘Abd-Allaah ibn Qa’ood. 
Fataawa al-Lajnah 
    al-Daa’imah (1/476) 
In the Book of Allaah there 
    is an indication that sculpting figures of animate beings with clay is 
    haraam. Allaah says (interpretation of the meaning): 
“(Remember) when Allaah 
    will say (on the Day of Resurrection). “O ‘Eesa 
    (Jesus), son of Maryam (Mary)! Remember My Favour to you and to your mother 
    when I supported you with Rooh‑ul‑Qudus [Jibreel (Gabriel)] so that you 
    spoke to the people in the cradle and in maturity; and when I taught you 
    writing, Al‑Hikmah (the power of understanding), the Tawraat (Torah) and the 
    Injeel (Gospel); and when you made out of the clay, a figure like that of a 
    bird, by My Permission, and you breathed into it, and it became a bird by My 
    Permission, and you healed those born blind, and the lepers by My 
    Permission, and when you brought forth the dead by My Permission”
[al-Maa’idah 5:110]
The one who studies this 
    verse will realize that the words “and when you made out of the clay, a 
    figure like that of a bird, by My Permission” clearly indicate that it 
    is haraam to make figures of clay in the form of birds – and other animate 
    beings – and that what ‘Eesa (peace be upon him) did was only done with the 
    permission of Allaah, so both actions were done by the permission of Allaah: 
    making the figure and breathing into it. The words “by My Permission” 
    indicate that it was forbidden to do that even in the law of ‘Eesa (peace be 
    upon him). 
Shaykh al-Islam Ibn 
    Taymiyah (may Allaah have mercy on him) said, explaining that the Messiah is 
    a slave of Allaah and a created being, not a creator: 
1 – He made out of clay a 
    figure like that of a bird. What is meant is that he gave it the shape of a 
    bird, and this kind of creation is something that all people are able to do. 
    One of them could make a figure of clay like that of a bird or any other 
    animal, but this image-making is haraam, unlike that which was done by the 
    Messiah, because Allaah gave him permission to do it. What is miraculous is 
    that he blew into it and it became a bird by Allaah’s leave. The miracle is 
    not just that he shaped it out of clay, because that is something that 
    anyone could do. The Prophet  (peace and blessings of Allaah be upon 
    him) cursed the image-makers and said: “The most severely punished of the 
    people on the Day of Resurrection will be the image-makers.” 
3 – Allaah told the Messiah 
    that he was only making the image and breathing into it with His permission, 
    and the Messiah told others that he did that with Allaah’s permission. 
    Allaah tells us that this was one of the blessings that He bestowed upon the 
    Messiah (peace be upon him) as He says (interpretation of the meaning): 
    “He [‘Eesa (Jesus)] was not more than a slave. We granted Our Favour to him, 
    and We made him an example for the Children of Israel” [al-Zukhruf 43:59]. 
Al-Jawaab al-Saheeh 
    (4/46, 47) 
And Allaah knows best.