Nested boundary techniques are developed based on the results of Perkins <1993> and Blake <1991>. We focus on the numerical and physical consistency needs across the nested boundary. These techniques replace the transition zone used by other researchers with a numerically and a physically based correction step. We demonstrate our method using a nested, reduced gravity version of the Naval Research Laboratory (NRL) primitive equation ocean model and a two-layer hydrodynamic finite-depth version of the same model. Numerical experiments are performed using integrations of both an idealized double gyre and a realistic Greenland Iceland Norwegian (GIN) Sea configuration. To illustrate the need for improved boundary treatment, we present a numerical study of boundary errors. The study illustrates the fragile nature of nested boundary conditions. With even small errors, a dramatic impact is observed on the formation (or lack thereof) of the Atlantic-Norwegian Current, which is responsible for transporting North Atlantic water to the Arctic Ocean, in the GIN Sea configuration.¿ 1997 American Geophysical Union