In this paper, the effects of interference on composite fading environments, where multipath fading coexists with shadowing, are investigated. Based on some mathematical convenient expressions for the sum of squared $\mathcal{K}$-distributed random variables, which are derived for the first time, important statistical metrics for the signal to interference and noise ratio (SINR) are studied for various cases including non identical, identical and fully correlated statistics. Furthermore, our analysis is extended to multi-channel receivers and in particular to selection diversity (SD) receivers, investigating two distinct cases, namely, signal-to-noise ratio based and SINR-based SD. For all scenarios, simplified expressions are also provided for the interference limited case, where the influence of thermal noise is ignored. The derived expressions are used to analyze the performance, in terms of the average bit error probability (ABEP) and the outage probability (OP), of such systems operating over composite fading environments. A high SNR analysis is also presented for the OP and the ABEP, giving a clear physical insight of the system's performance in terms of the diversity and coding gains. The analysis is accompanied by numerical evaluated results, clearly demonstrating the usefulness of the proposed theoretical framework.