Effective interaction modeling and behavior prediction of dynamic agents play a significant role in interactive motion planning for autonomous robots. Although existing methods
have improved prediction accuracy, few research efforts have been devoted to enhancing prediction model interpretability and out-of-distribution (OOD) generalizability. This work addresses these two challenging aspects by designing a variational autoencoder framework that integrates graph-based representations and time-sequence models to efficiently capture spatio-temporal relations between interactive agents and predict their dynamics. Our model infers dynamic interaction graphs in a latent space augmented with interpretable edge features that characterize the interactions. Moreover, we aim to enhance model interpretability and performance in OOD scenarios by disentangling the latent space of edge features, thereby strengthening model versatility and robustness. We validate our approach through extensive experiments on both simulated and real-world datasets. The results show superior performance compared to existing methods in modeling spatio-temporal relations, motion prediction, and identifying time-invariant latent features.