teilnehmend
sympathetic
Showing compassion or sympathy for another person's situation.
Er hörte sich ihre Sorgen mit teilnehmender Miene an.
He listened to her worries with a sympathetic expression.

sympathetic / participating
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sympathetic
Showing compassion or sympathy for another person's situation.
Er hörte sich ihre Sorgen mit teilnehmender Miene an.
He listened to her worries with a sympathetic expression.

'Teilnehmend' (sympathetic/participating) is the present participle of the verb 'teilnehmen' (to participate). This form describes a person or thing that is currently active. This can refer to an event ('an etwas teilnehmen' — to take part in something) or to a person's feelings ('Anteil nehmen' — to sympathize).
Alle teilnehmenden Kinder bekamen eine Urkunde.
All participating children received a certificate.
You can recognize the meaning from context. If it is about feelings and reactions, it means sympathy (e.g. 'ein teilnehmender Blick' — a sympathetic look). If it is about an event or activity, it refers to the participants (e.g. 'die teilnehmenden Firmen' — the participating companies).
Sie hörte seiner Geschichte mit teilnehmendem Interesse zu.
She listened to his story with sympathetic interest.
In the meaning of 'mitfühlend' (sympathetic), the adjective is often combined with words that express a reaction or attitude, e.g. 'eine teilnehmende Geste' (a sympathetic gesture), 'ein teilnehmender Blick' (a sympathetic look), or 'teilnehmende Worte' (sympathetic words).
Er legte ihr teilnehmend eine Hand auf die Schulter.
He sympathetically placed a hand on her shoulder.
In the meaning of 'partizipierend' (participating), 'teilnehmend' almost always comes directly before a noun referring to a person or a group. It describes who is taking part in an action.
Eine Liste der teilnehmenden Künstler finden Sie im Programmheft.
You can find a list of the participating artists in the program booklet.
present
'anwesend' and 'teilnehmend' can both occur in the context of events or activities. 'anwesend' only means that someone is physically present. The person does not have to take an active part. 'teilnehmend' means that someone is involved in an activity and takes part. Learners may confuse the words because participating people are usually also present. But not every present person is participating. If you only want to say that someone is there, use 'anwesend'. If the person is really taking part, 'teilnehmend' is more precise.

Die teilnehmenden Personen bekommen vor dem Kurs eine E-Mail.
The participating people will receive an email before the course.
Sie ist morgen beim Gespräch anwesend, sagt aber nichts.
She will be present at the meeting tomorrow but will not say anything.