AbstractThis study addresses the impact of coupling between wave and circulation models on the quality of coastal ocean predicting systems. This is exemplified for the German Bight and its coastal area known as the Wadden Sea. The latter is the area between the barrier islands and the coast. This topic reflects the increased interest in operational oceanography to reduce prediction errors of state estimates at coastal scales, which in many cases are due to unresolved non-linear feedback between strong currents and wind waves. In this study we present analysis of wave and hydrographic observations, as well as results of numerical simulations. A nested-grid modelling system is used to produce reliable nowcasts and short-term forecasts of ocean state variables, including waves and hydrodynamics. The database includes ADCP observations and continuous measurements from data stations. The individual and combined effects of wind, waves and tidal forcing are quantified. The performance of the forecast system is illustrated for the cases of several extreme events. The combined role of wave effects on coastal circulation and sea level are investigated by considering the wave-dependent stress and wave breaking parameterization. Also the response, which the circulation exerts on the waves, is tested for the coastal areas. The improved skill of the coupled forecasts compared to the non-coupled ones, in particular during extreme events, justifies the further enhancements of coastal operational systems by including wave effects in circulation models.