Example-based mesh deformation methods are powerful tools for realistic shape editing. However, existing techniques typically combine all the example deformation modes, which can lead to overfitting, i.e., using an overly complicated model to explain the user-specified deformation. This leads to implausible or unstable deformation results, including unexpected global changes outside the region of interest. To address this fundamental limitation, we propose a sparse blending method that automatically selects a smaller number of deformation modes to compactly describe the desired deformation. This along with a suitably chosen deformation basis including spatially localized deformation modes leads to significant advantages, including more meaningful, reliable, and efficient deformations because fewer and localized deformation modes are applied. To cope with large rotations, we develop a simple but effective representation based on polar decomposition of deformation gradients, which resolves the ambiguity of large global rotations using an as-consistent-as-possible global optimization. This simple representation has a closed form solution for derivatives, making it efficient for our sparse localized representation and thus ensuring interactive performance. Experimental results show that our method outperforms state-of-the-art data-driven mesh deformation methods, for both quality of results and efficiency.