This paper extends earlier work on derivative-based optimization for cost-effective remediation to unconfined aquifers, which have more complex, nonlinear flow dynamics than confined aquifers. Most previous derivative-based optimization of contaminant removal has been limited to consideration of confined aquifers; however, contamination is more common in unconfined aquifers. Exact derivative equations are presented, and two computationally efficient approximations, the quasi-confined (QC) and head independent from previous (HIP) unconfined-aquifer finite element equation derivative approximations, are presented and demonstrated to be highly accurate. The derivative approximations can be used with any nonlinear optimization method requiring derivatives for computation of either time-invariant or time-varying pumping rates. The QC and HIP approximations are combined with the nonlinear optimal control algorithm SALQR into the unconfined-aquifer algorithm, which is shown to compute solutions for unconfined aquifers in CPU times that were not significantly longer than those required by the confined-aquifer optimization model. Two of the three example unconfined-aquifer cases considered obtained pumping policies with substantially lower objective function values with the unconfined model than were obtained with the confined-aquifer optimization, even though the mean differences in hydraulic heads predicted by the unconfined- and confined-aquifer models were small (less than 0.1%). We suggest a possible geophysical index based on differences in drawdown predictions between unconfined- and confined-aquifer models to estimate which aquifers require unconfined-aquifer optimization and which can be adequately approximated by the simpler confined-aquifer analysis. ¿ 1999 American Geophysical Union