The outside is buttercream frosting with fondant decorations. The castle walls are made out of fondant and "glued" together with candy melts. I also attached sticks to the inside of each wall so I could stick it into the cake and have it stand upright (worked great, except a bunch of the icing came off with the castle when I pulled it out to cut the cake.
You'll notice that Mario is just a little print-out :( This saddened me, but there was no other option (other than not having Mario at all on the cake and that just didn't seem right!). I tried to have an actual Mario. Really, I did. My first thought (though she had/has no idea) was to see if my friend who is good at fondant figures could do one for me. However, she and her family got sick that week and so I didn't get to spend the time with her I normally would. Then, I figured, well I can do this! So I got started....and about halfway through I could tell it wasn't going well. He just wasn't looking right and I hadn't gotten anywhere near doing his face (which I knew would be the hardest part). I had already checked a nearby cake store for a plastic Mario figurine and they didn't have any. So there you go-that's how I ended up with a Mario print-out.