This paper formulates a discrete-time, link-based dynamic user-optimal route choice problem using the variational inequality approach. The proposed model complies with the dynamic user-optimal equilibrium condition in which for each origin-destination pair, the actual travel time experienced by travelers departing during the same interval is equal and minimal. A nested diagonalization procedure is then proposed and demonstrated with a numerical example. (C) 1998 Elsevier Science Ltd. All rights reserved.