Applied Science Associates (ASA), in partnership with Drexel University, the National Oceanic and Atmospheric Administration (NOAA), and the University of Rhode Island, is developing a real-time nowcast/forcast system for Narragansett Bay and Rhode Island Sound. Such a system will provide valuable information to the shipping industry, the sailing community, the research community and the general public within the region. The system will utilize ASA's boundary fitted hydrodynamic model, BFHYDRO, in a fully coupled three-dimensional baroclinic mode to predict tidal elevation, currents, and the distribution of salinity and temperature within Narragansett Bay and Rhode Island Sound. NOAA will supply atmospheric and tidal boundary conditions through a high-resolution (2-4km) non-hydrostatic atmospheric prediction model and the operational Extra-Tropical Storm Surge Model. Data supplied from the recently operational Narragansett Bay PORTS system will be used to verify system predictions during the development stage and to enhance prediction through data assimilation once the system is operational. This paper addresses the first stage of this project in which two-dimensional tidal predictions for Narragansett Bay and Rhode Island Sound are developed in order to determine the optimum grid resolution, the appropriate location of the open boundary and to test the linkages to the NOAA atmosphere storm surge forecast models.