The validation and subsequent application of the current three dimensional numerical hydrodynamic model of Chesapeake Bay is presented. The numerical model solves conservation equations for water mass, momentum, salinity, and heat on a boundary-fitted grid in the horizontal plane. The vertical grid is Cartesian. A finite-difference solution scheme is employed such that vertically-averaged equations are first solved to yield the water surface elevations. These are then utilized in the computation of the barotropic portion of the horizontal pressure gradient in the internal mode. Model validation was accomplished by demonstrating the model's ability to reproduce observed data over time scales ranging from tidal to seasonal periods. After validation, the model was applied to simulate bay hydrodynamics for the 10 years of 1985-94. These results were used to drive the three-dimensional water quality model of Chesapeake Bay, which is discussed in a companion paper.