An isolation mechanism and technique for packaging a MEMS transducer, such as a bulk acoustic wave gyroscope or accelerometer, which allows rotational information to be sensed by the transducer while providing the necessary isolation from externally applied (or internally induced) stress, strain, vibration, shock and thermal transients. The isolation mechanism is constructed of interposing materials that may be implemented with elastomeric-strain-absorbing-materials (ESAM) layers having different elastic moduli, with the most compliant ESAM layer disposed closest to the MEMS transduce. In another embodiment, one or more ESAM layers may have air pockets dispersed therein. The isolation mechanism enables mechanical, thermal and vibrational isolation of the MEMS transducer from the package substrate, while still permitting electrical continuity between the MEMS device and the external environment.