A unique formulation of describing fluid motion is presented. The method, referred to as "extended Lagrangian method," is interesting from both theoretical and numerical points of view. The formulation offers accuracy in numerical solution by avoiding numerical diffusion resulting from mixing of fluxes in the Eulerian description. The present method and the Arbitrary LagrangianEulerian (ALE) method have a similarity in spirit-eliminating the cross-streamline numerical diffusion. For this purpose, we suggest a simple grid constraint condition and utilize an accurate discretization procedure. This grid constraint is only applied to the transverse cell face parallel to the local stream velocity, and hence our method for the steady state problems naturally reduces to the streamlinecurvature method, without explicitly solving the steady streamlinecoordinate equations formulated a priori. Unlike the Lagrangian method proposed by Loh and Hui which is valid only for steady supersonic flows, the present method is general and capable of treating subsonic flows and supersonic flows as well as unsteady flows, simply by invoking in the same code an appropriate grid constraint suggested in this paper. The approach is found to be robust and stable. It automatically adapts to flow features without resorting to clustering, thereby maintaining rather uniform grid spacing throughout and large time step. Moreover, the method is shown to resolve multi-dimensional discontinuities with a high level of accuracy, similar to that found in one-dimensional problems. 1995 Academic Press, inc.