Walt Disney had his era, but who will sociologists of the future identify as the icons of today's kids? The Fonz? Ronald McDonald? The answer is more likely to be Jim and Jane Henson and their cuddly, klutzy creatures of foam rubber and fur, the Muppets.

The Hensons brought the lovable Muppets (the name is an amalgam of marionette and puppet) to Sesame Street seven years ago to make reading and counting fun for preschool children. Now the Hensons are repeating their wacky success with the Muppet Show, an Emmy winner syndicated in 163 U.S. cities and an astonishing 103 foreign countries.

More glory awaits the Muppets. Elder statesman Kermit the Frog (age 21 this year) will be presented to Queen Elizabeth, along with Frank Sinatra and Bob Hope, at a Jubilee performance in London on Nov. 21. Kermit will float down Broadway on Thanksgiving as the first new balloon in three years to join the Macy parade. What's more, the Muppet Show's "cast" album became an unlikely No. 1 hit in England last June when it displaced the Beatles' Live at the Hollywood Bowl.

The foster parents of all the silliness—there are now more than 500 Muppet characters—started the gang as "a lark." Jim, now 41, was born in Mississippi, but his father, an agronomist with the Department of Agriculture, moved the family to Hyattsville, Md., a Washington suburb, when Jim was 2. "I never played with puppets when I was a kid," Henson remembers, but did join his high school puppet club as a way to get into television. (Puppeteer Bil Baird was then a big TV star.) Jane, 43, grew up on Long Island in an unusual household headed by her father, "Dal Lee" (his real surname was Nebel), a well-known astrology editor of the 1940s and 1950s.

Jim and Jane met in 1954 in a freshman puppetry class at the University of Maryland. "It was required of art majors," she explains. The previous summer Jim had begun appearing on local TV shows with his handmade puppets, and toward the end of the semester he asked his classmate Jane to join him as a partner. She considered it as "just a way to make money for weekends," but soon they were given their own five-minute show, Sam and Friends. It became a late-night satirical hit. "I'd paint the scenery, and Janie would carry it in the station wagon," Jim recalls. "We made the first Kermit from one of my mother's old coats with Ping-Pong balls for his eyes."

Jim still considered puppeteering "not the sort of thing one does for a living"—even though he made enough from the show and commercials to drive to his college graduation in a vintage Rolls-Royce. During a trip to Europe, where puppetry is more widely accepted, Henson realized the artistry of his craft and its further potential for television. He and Jane were the first to design "expressive" puppets, better suited to TV close-ups than to theaters. "Our puppets don't have that hard, wooden quality," Jim observes. "There is something shaggy and endearing about them."

In 1959 Jim and Jane were married and three years later moved to New York, where their breakthrough was putting the Muppets on the Today show. Regular appearances followed on both the Ed Sullivan and Jack Paar shows as well as the Jimmy Dean Show, for which Jim created Dean's sidekick, a deadpan dog named Rowlf. The Muppets signed with Children's Television Workshop and Sesame Street in 1970.

By then Jane had given birth to four of their five children and largely dropped out of performing. Now she manipulates Muppets when Jim needs a hand on Sesame Street or occasional specials. He is still the voice and hands behind his alter ego, Kermit, as well as Ernie and others. "The women's lib thing about yearning for a career or feeling cheated because I had children doesn't fit me," Jane says. "The career was always open to me. But I was not able to handle both easily. So I chose to stay home."

The Hensons live in a rambling house in suburban Bedford, N.Y., where the kids—Lisa, 17, Cheryl, 16, Brian, 14, John, 12, and Heather, 6—share the turf with five cats, two Pekapoo dogs and a rabbit. Unlike millions of homes, the place is not littered with Sesame Street records, books, games and puppets. "We've tried to separate our shop and our house," Jim asserts. "We've never deliberately involved the children as guinea pigs for the show," adds Jane. "They watch it as an involved audience. They are very aware and," she says, "they criticize."

The kids have unlimited access to the Muppetorium, Henson's Santa-like office/workshop in two townhouses on Manhattan's East Side. Henson Associates (HA! on the letterhead) has grown from a Jim-and-Jane shop to a multimillion-dollar company with a staff of 30. "Our two oldest girls are very skillful with their hands and can help," Jane says. "But the boys need a lot more discipline before they can be of much use." (Brian, however, is an electronics whiz, and John carves intricate wood puzzles.)

The Hensons do not deny the strain of working simultaneously on Sesame Street and the Muppet Show, which is produced in England. Unable to obtain backing in this country for an "adult" puppet show, Henson won over London impresario Sir Lew Grade. Jim spends alternate months in England doing the series. "I'm away a lot more than is healthy," he admits. "It's hard on Jane and the family."

Their solution is to pack off one or more of the kids with Jim on his London visits. Cheryl went last summer; Lisa is going this month. Jim took the three oldest on vacation to Marrakesh last July, and a year ago the entire family sailed the Aegean. They are planning to ski together near Aspen this winter.

With Jim gone so much, Jane finds herself "slipping back into the foreground" with the Muppets, especially on the business end. He, in turn, is talking of expanding beyond TV into feature films. Though Jim forbids any of his Muppet products, like Big Bird or Cookie Monster dolls, to be advertised on his television shows—"It takes advantage of children"—he is not above pitching himself with his recent "Do-you-know-me?" American Express commercial. Sometimes the pace leaves Jane feeling a little like Oscar the Grouch. "I like to keep life fairly simple," she sighs. "But our life is fairly complicated."