This paper describes the development and application of a three-dimensional model for coastal and estuarine circulation. The model uses a harmonic expansion in time and a finite element discretization in space. All nonlinear terms are retained, including quadratic bottom stress, advection and wave transport (continuity nonlinearity). The equations are solved as a global and a local problem, where the global problem is the solution of the wave equation formulation of the shallow water equations, and the local problem is the solution of the momentum equation for the vertical velocity profile. These equations are coupled to the advection-diffusion equation for salt so that density gradient forcing is included in the momentum equations. The model is applied to a study of Delaware Bay, U.S.A., where salinity intrusion is the primary focus. ?? 1991.